Development of a conceptual framework on rewarding failure in innovation attempts as an incentive...

1/8/2016

Development of a conceptual framework on rewarding failure in innovation attempts as an incentive for employees with outsets in the

Construction Industry Innovation Management

Dragos Bogdan Todoran

Master Thesis, Aalborg University

i

Title sheet

Faculty:

Aalborg University

Department of Mechanical and Manufacturing Engineering Fibigerstræde 16, 9220 Aalborg Øst, Denmark

Education:

Management in the Building Industry

Cand.Tech.Byggeledelse

Title: Development of a Conceptual Framework on rewarding failure in innovation attempts as an incentive for employees with outsets in the construction Industry Topic:

Innovation Management

Project period:

1 September 2015 – 08 January 2016

Author


[email protected]

Main supervisor:

Henrik Sørensen, M.Sc. Eng, PhD

[email protected]

Main report content: 34 pages

Appendix content: 37 pages

Delivery date:

08/01/2016


___________________________________________________

Synopsis This short Master Thesis covers the

dilemma, of whether employees should be

rewarded for failed innovation attempts.

The dilemma is handled as an incentive

system with outsets in the Construction

Industry, and developing a conceptual

framework for doing so. The research is

conducted through a case study with

multiple case units and a comparative

analysis between them. The results show

that rewarding failure in innovation

attempts is an incentive mechanism for

employees but it has been applied scarcely

so far in real life applications. The

relevance of this research is that so far,

innovation management in this aspect has

been scarcely covered.

The second part of the thesis is to

investigate how the construction industry

learns from other industries. The

investigation has been carried out with the

purpose of reaching common key

mechanisms, between the historical

adoption of Lean construction,

applicability of EDI, and “rewarding

failure” so that a conceptual framework

for conducting an incentive program was

developed.

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Summary

This research was conducted as a Master of Science final Thesis in Management in the Building

Industry Programme (MSc) at Aalborg University, Department of Mechanical and Manufacturing

Engineering, Aalborg, Denmark. This thesis was conducted as a paper based version, based on

three papers, cf. Appendix, and annexes which describe the data collection and analysis process

in a full perspective.

The construction industry has long been known as a main driver for the economy in many

countries, and an important part of today’s job sector. However, the construction industry is also

well known for its resistance to change, and considered slow adapting when it comes to

innovation. Instead of being focused on long term planning, development and innovation; it

focuses on short‐term gains or “low hanging fruit”. Regardless of these aspects, the construction

industry has a large potential for fostering innovation processes through its complex

organizations and intertwined environment. In many industries, the employees are considered

an important and effective source of innovation and creativity potential. Incentive programs,

either financial or psychological have been used along time to reward productivity or successful

application of different innovation processes, whereas failure has been always rejected and

dismissed bluntly in most cases, by thus having a negative impact on employees’ motivation.

The main topic of this research was the development of a conceptual framework in which an

incentive program that rewards failure in innovation attempts can find its place within the

construction industry. The key areas of interest were: firstly, innovation management in different

industrial sectors, and their application of incentive systems which rewards failure in innovation

attempts. And second to find a place for the applicability of such an incentive system in the

construction industry.

The findings were based on an exploratory case study with multiple case units; a comparative

analysis between them and another case study from previous research made in this topic. The

originality was based upon the fact that this topic has been researched scarcely so far.

The research was initiated by literature review, where answers to such an incentive system could

be found, and once contact with a corporation has been established which fosters such an

incentive program, a case study was developed based on two units within the main corporation.

In order to ensure credibility of the data, a comparative analysis has been made between the two

case units and a previously researched case study, to identify recurring patterns and key

mechanisms for adopting such a system. The research was then directed, towards the learning

capabilities of the construction industry from other industries. Through the research, the

adoption of Lean practices was undertaken and also Employee‐driven innovation, in order to

identify similar key mechanisms as to where an incentive system such as rewarding failure could

be fostered within the Construction Industry.

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Dansk Resume

Denne undersøgelse var udført som kandidatspeciale i Byggeledelse (cand.scient.tech) ved

Aalborg Universitet, Institut for Mekanik og Produktion. Denne afhandling blev udført som en

papirbaseret udgave, hvor den er baseret ud fra tre bilag.

Byggebranchen har længe været kendt som den vigtigste drivkraft for økonomien i mange land

og er derfor en vigtig del af jobsektoren i dag. Byggebranchen er også kendt for sin modstand

mod forandring, og anses for langsom tilpasning, når det gælder innovation. I stedet for at være

fokuseret på langsigtet planlægning, udvikling og innovation, fokuserer den på kortsigtede

gevinster eller kortsigtet profit. Uanset disse aspekter har byggeriet et stort potentiale for at

fremme innovationsprocesser gennem sine komplekse organisationer og sammenflettede miljø.

I mange brancher betragtes de ansatte som en vigtig og effektiv kilde til innovation og kreativ

tankegang. Programmer for medarbejdere har længe eksisteret for at belønne medarbejdere

økonomisk. Enten ved at øge produktiviteten, eller implementere innovative processer,

hvorimod fiasko altid bliver afvist, og dermed har det en negativ effekt i forhold til

medarbejdernes motivation. Det vigtigste emne i denne forskning var udviklingen af en

begrebsramme, hvor et incitamentsprogram, der belønner svigt i innovationsforsøg kan finde sin

plads i byggebranchen. De mest interessante hovedområder var først og fremmest

innovationsledelse i forskellige industrielle sektorer og deres implementering af

incitamentsordninger, som belønner på trods af fejl i innovationsforsøg, og for det andet at finde

anvendeligheden af et sådant incitament system i byggebranchen.

Resultaterne var baseret på forskningsmæssige sager med flere sags enheder, og en komparativ

analyse mellem dem og sager fra tidligere forskning foretaget i dette emne. Originaliteten var

baseret på det faktum, at dette emne er blevet forsket minimalt.

Forskningen blev indledt af en litteraturgennemgang, hvor svar på et sådant incitament system

kunne findes, og når der er etableret kontakt til en virksomhed, der fremmer et sådan

incitamentsprogram, blev en sag udviklet på baggrund af to enheder inden for det centrale

selskab. For at sikre troværdigheden af de oplysninger er der blevet lavet en komparativ analyse

mellem de to sags enheder, hvor tidligere forskning af disse studier har identificerede de vigtigste

mekanismer til at vedtage et sådant system.

Forskningen blev derefter rettet mod læringskapaciteter af byggebranchen fra andre industrier.

Gennem forskning har implementeringen vist hvordan besparelser skal gennemføres og også

medarbejder drevet innovation med henblik på at identificere lignende vigtige mekanismer til,

hvordan et incitament system som belønner medarbejdere, som tør tænke og arbejde innovativt

selvom der er risiko for fiasko, hvor incitament systemet kunne fremme dette inden for

byggebranchen.

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LIST OF ACRONYMS

EDI – Employee‐Driven Innovation

R&D – Research and Development

OECD – Organisation for Economic Co‐operation and Development

OSLO Manual – Guidelines for collecting and interpreting innovation data

RQ – Research Question

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Acknowledgments

This thesis was conducted in collaboration with the Construction Management group at the

Department of Mechanical & Manufacturing Engineering at Aalborg University. There are a

number of people who have been involved in making this Master Thesis possible and guiding me

through my studies. Therefore I owe a special thanks to:

First and foremost, I am gladly in debt to my supervisor, Henrik Sørensen for his continuous

support, good feedback and willingness to encourage and keep me on track with my research. In

understanding my ambitions for the future in hoping to take a Ph.D. degree and guiding me

through the process as best as possible, you have become a model and an inspiration for me as

a researcher and a professional in the field.

Second of all I am grateful for all the good input and the occasional good talks with my professor

Jesper Kranker Larsen, especially on research paradigms and his more detailed explanation on

some information I used in this thesis. A special thanks I owe to Prof. Lene Faber Ussing, our class

coordinator for listening to me when I was in need and guiding me through various problems.

I wish to also express my gratitude towards all my teachers from Aalborg University. Without

their guidance, I would not have reached in finishing a Master Thesis.

A special thank you I owe to Mr. Ranjeet Joshipura, from TATA Group for helping me out get in

touch with several departments of TATA Group in pursuing this research. I also am grateful and

wish to thank for their good input to Mr. Sujit Guha from TATA Consultancy Services and to Peter

Brown from Jaguar Land Rover Ltd. for his input and data provided for my thesis. Without their

help, I would not have had the data I needed.

I also owe a special thanks to my girlfriend, Tiffany who has been most patient with me especially

in the last few weeks of this Thesis, when the work was at its hardest peak and for her continuous

support. I also wish to say I special thank you to my best friend Olimpiu, for all the talks we had

on my thesis and his support always when I needed. A thank you should also go to Asbjørn for

his willingness to jump in and help when my Danish skills were out of control or simply not

enough.

Last but not least, I wish to dedicate this Thesis to my family. It is a challenge and a hard one to

raise a child and guide him through life giving him the best you can, so he can grow and develop

as a human being. So far, this thesis encompasses all the years of hard work and sacrifices, and it

is for now the peak of my professional development. Especially to my little brother Tudor; one

day when you grow up, I hope you get even further than I ever did and make me proud even

more for being your humble, older brother.

Aalborg, January 2016


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Table of Contents Title sheet ...................................................................................................................................................... i

Summary ...................................................................................................................................................... iii

Dansk Resume .............................................................................................................................................. iv

Acknowledgments ........................................................................................................................................ vi

CHAPTER 1. INTRODUCTION ......................................................................................................................... 1

1.1 BACKGROUND AND MOTIVATION ............................................................................................... 1

1.2 RESEARCH PROBLEM .................................................................................................................... 4

1.3 DEFINITIONS, DELIMITATIONS AND CLARIFICATIONS ................................................................ 6

1.4 THESIS STRUCTURE ....................................................................................................................... 7

CHAPTER 2. RESEARCH DESIGN .................................................................................................................... 8

2.1 SCIENTIFIC PARADIGM ................................................................................................................. 8

2.2 ONTOLOGY.................................................................................................................................. 10

2.3 EPISTEMOLOGY .......................................................................................................................... 11

2.4 METHODOLOGY .......................................................................................................................... 11

2.5 RESEARCH DESIGN ...................................................................................................................... 12

2.6 ASSESMENT OF THE RESEARCH DESIGN .................................................................................... 16

CHAPTER 3. DEVELOPMENT OF A THEORETICAL BASE OF KNOWLEDGE ................................................... 17

3.1 REWARDING FAILURE IN INNOVATION ATTEMPTS AS AN INCENTIVE SYSTEM ...................... 17

3.1.1 TESTING THE THEORETICAL AND PRACTICAL LANDSCAPE OF THE TOPIC “REWARDING

FAILURE IN INNOVATION” ................................................................................................................. 17

3.1.2 THE THEORETICAL LANDSCAPE OF THE TOPIC “REWARDING FAILURE IN INNOVATION”

18

3.1.3 PARTIAL CONCLUSION ........................................................................................................ 19

3.1.4 TESTING THE PRACTICAL LANDSCAPE OF THE TOPIC “REWARDING FAILURE IN

INNOVATION” – CASE STUDY AT TATA GROUP ................................................................................ 19

3.1.5 CASE STUDY RESULTS – THE PRACTICAL LANDSCAPE ....................................................... 20


3.2 THE POSSIBILITIES OF THE CONSTRUCTION INDUSTRY OF LEARNING BY EXAMPLE ............... 22

3.2.1 LITERATURE STUDY ............................................................................................................ 22

3.2.2 ADOPTION OF LEAN CONSTRUCTION FROM THE MANUFACTURING INDUSTRY ............ 23

3.2.3 THE THEORETICAL LANDSCAPE OF LEAN CONSTRUCTION ADOPTION............................. 23


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3.2.5 TESTING EMPLOYEE‐DRIVEN INNOVATION FOR A POTENTIAL FOSTERING

ENVIRONMENT ................................................................................................................................... 25


CHAPTER 4. DEVELOPMENT OF CONCEPTUAL FRAMEWORK FOR THE IMPLEMENTATION OF AN

INCENTIVE PROGRAM WITHIN AN ORGANIZATION ................................................................................... 29

4.1 A CONCEPTUAL FRAMEWORK FOR AN INCENTIVE PROGRAM SUCH AS REWARDING

FAILURE IN INNOVATION ATTEMPTS ................................................................................................ 30

4.2 CONCLUSIONS AND PERSPECTIVES ........................................................................................ 32

References ……………………………………………………………………………………………………………………………………….34

Appendix A ………………………………………………………………………………………………………………………………………..

Appendix B ………………………………………………………………………………………………………………………………………..

Appendix C ………………………………………………………………………………………………………………………………………..

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CHAPTER 1. INTRODUCTION

In this chapter, the background for the report, motivation and clarifications will be presented. Moreover, the research questions are outlined, together with the thesis structure, including the separation between the main thesis and appendixes. The specific methods for obtaining the necessary data are presented in Appendix A – Methodology for Introduction and Problem formulation [Working paper].

1.1 BACKGROUND AND MOTIVATION One of the perspectives that has not really been resolved, is the dilemma whether failure in innovation attempts should be rewarded, while keeping in mind that employees should be rewarded for their effort, and motivated to contribute more to innovation attempts. [Sørensen, 2015]. This thesis looks into this specific gap in research. Also, what needs to be considered is that there is a common agreement between most actors involved in one way or another in the construction industry that it is conservative and slow paced when it comes to innovation compared to other industries. [Tatum, 1987; Winch 2003; Bygballe & Ingemansson, 2014]. [Bougrain et.al. 2010] give this conservatism of the industry the term laggard.

However slow paced and conservative the construction industry is, [Winch, 2003] draws the conclusion at the end of his research that the construction industry is not that idiosyncratic to not be able to learn from other manufacturing industries. The construction industry innovation process is very different compared to the manufacturing process but provides excellent potential for fostering innovation through its existing project models and network capability [Anderson & Schaan, 2001; Johnston & Lawrence, 1988; Seaden & Manseau 2001]. And what is also important is that this goes the other way around. [Winch, 2003] argues that the manufacturing industry can also learn from the construction industry.

[Bygballe & Ingemansson, 2014; Slaughter, 1993] found out that employees are the main driver for innovation in construction companies, and most importantly that [Arditi & Tangkar, 2000; Sørensen, 2015] seem to agree that R&D departments are not solely responsible for innovation anymore, but that employees strive and drive the innovation processes forward; [Kesting & Ulhøi, 2010] support this.

In order to assess properly the innovation process within the construction industry, it has to be considered that innovation in this industry is rather challenging with a very complex arena [Seaden & Manseau, 2001]. However, it is important to look upon how innovation is defined in a broader aspect. The problem is that the variations of the term innovation are quite large. Innovation can be described as “a change in routine” [Nelson & Winter, 1982]. Others, describe it in this context as a first use of a new technology in a construction firm [Tatum, 1987]. Or, as [Higgins, 1994] goes, he resolves this into an equation giving 4 dimensions to innovation; Product, Process, Marketing and Management.

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Drawing a simple perspective on this, it is imperative to look into a source which is widely used and commonly agreed upon in the OECD countries where the following explanation is given:

“A technological product innovation is the implementation/commercialization of a product with improved performance characteristics such as to deliver objectively new or improved services to the consumer. A technological process innovation is the implementation/adoption of new or significantly improved production or delivery methods. It may involve changes in equipment, human resources, working methods or a combination of these.” [OECD, 1997 sect. 24]

As seen in the Oslo Manual in its second edition, it focuses only on two dimensions, which Higgins came up with through the Innovation equation. However, in its third edition the Oslo Manual [OECD & Eurostat, 2005] adds Marketing and Organizational innovation into account, by thus aligning itself to Higgins’s equation1. Considering this, the need to look into specific explanations for marketing and management innovation is required. [Higgins, 1994] defined Marketing innovation as being product functions separate from the product development itself therefore according to [Pearce, 1992] attributed all this to a management process responsible for planning action to satisfy and identify customer needs. On the other hand, Management innovation, can be found for example in reengineering which he calls an innovation but the basis of the dimension would be improving the way the organization is managed. [Higgins 1994].

Figure 1.1 – The innovation equation [Higgins 1994]

In regards to innovation in Scandinavia, [Bygballe’s & Ingemansson, 2014] present findings from two studies of innovation in the Norwegian and Swedish market. As they mention the similarities between the two markets, it is quite sensitive to assume that any similar study conducted on the Danish market would give similar results. The similarity between Denmark, Sweden and Norway can be sustained by [Hansen, 2011].

Briefly illustrating, in their study, [Bygballe’s & Ingemansson, 2014] present the findings in their joint study that in Sweden, 78% of the respondents were defining co‐workers as the main driving force of innovation while in Norway around 53% were following the same pattern. Also it is

1 It is the authors’ belief that the explanation provided in the OSLO Manual, third edition on organizational innovation is almost similar to the management innovation definition provided by Higgins, therefore the two differences in terms are considered to be irrelevant being one and the same principle.

3

interesting to mention that customers were the second choice in Sweden as a driving force for innovation, while in Norway the customers where the first option.

The study conducted also showed that it is processes and managing projects that are innovated mostly whereas technical developments and materials are less centralized [Bygballe & Ingemansson, 2014]. The research also reinforced previous research that innovation in the construction industry is highly different compared to manufacturing industries due to the relations between construction parties, by thus the “complex arena” being confirmed [Seaden & Manseau 2001].

In regards to the Danish construction sector, a Master thesis report conducted at Aalborg University showed that innovation in Northern Denmark at least is mostly present within middle sized and larger companies [Bohnstedt & Larsen, 2012]. But the most interesting aspect to be considered as a starting point and seeing the similarity with the Swedish and Norwegian industry is that the half of the companies that are seeking improvements and potential breakthroughs by using innovation not only are involving employees but they are also rewarding successes.

In Figure 1.2 research conducted by the Danish Statistics show again similarities with the previous study in Sweden and Norway. The similarities conclude the fact that it is process and organizational innovation that are predominant throughout the industry, therefore reinforcing the findings in the other two Scandinavian countries.

Figure 1.2 – Innovative companies according to branch and innovation type [Danmark statistik, 2015a]

If until now, the data presents that larger companies adopt and foster systems that can have improved potential for advanced innovation processes, the next part looks into one structure or methodology which essentially deals with the involvement of employees into the innovation process – Employee‐driven innovation. To further detail on the topic and find which potential solutions can be adopted, Employee Driven Innovation is chosen as a reference point into what type of processes can foster and have potential answers.

For a better understanding, the following figure shows the core elements of EDI at an organizational level. The figure presents three main viewpoints and interaction into EDI: Organizational culture/Organization of work, Learning processes and Innovation processes.

4

Figure 1.3 – EDI in an organizational context [Høyrup, 2012]

Innovation can be derived from the way employees perform their jobs, taking into account the organization as well as personal interests [Price et. al, 2012] Whereas the authors acknowledge the appearance of innovation from different practices, they also take into account the aforementioned characteristics of the organization; but the main aspect being that while day to day processes keep going on, and teams tend to disband and re‐form according to the different tasks assigned, the learning process keeps continuing. Taking into account the complexity of construction companies organizations, this topic becomes much more interesting to follow.

The motivation for pursuing the topic of “rewarding failure” lies in the willingness to find examples of how “rewarding failure” can be done. The significance of this thesis is that it combines elements from different industries and tries to organize them into a conceptual framework of how innovation failures can be a positive process and should be rewarded in some situations – with the end scope of attributing these elements to the construction industry.

1.2 RESEARCH PROBLEM

Drawing conclusions from the previous subchapter, it can be clearly underlined that:

The construction industry is having an intertwined complex system – “arena” [Seaden & Manseau 2001].

The construction industry it is conservative and slow paced when it comes to innovation compared to other industries. [Tatum, 1987; Winch 2003; Bygballe & Ingemansson, 2014] – laggard [Bougrain et.al. 2010]

However, the construction industry provides excellent potential for fostering innovation through its existing project models and network capability. [Anderson & Schaan, 2001; Johnston & Lawrence, 1988; Seaden & Manseau 2001] et.al.

The task of innovation does not rely only on the shoulders of R&D Departments anymore, employees being an important part of it. [Bygballe & Ingemansson, 2014; Slaughter, 1993; Sørensen, 2015; Tangkar & Arditi, 2000; Kesting & Ulhøi, 2010]

Creativity + Organizational culture usually results in proper innovation products [Higgins 1994]

5

More than half of respondents of surveys conducted within the construction industry in Northern Denmark, Sweden and Norway have answered that employees are an important part of the innovation process. [Bygballe’s & Ingemansson, 2014, Danmark statistik, 2015]. A further note on this is that according to [Bohnstedt & Larsen, 2012] it is large companies that drag the industry forward when it comes to innovation processes (over 50 employees)

The involvement of employees into innovation attempts and the process related to it can be traced to a framework such as Employee‐Driven innovation, where there exists a connection between the work‐organization to learning and innovation. Therefore the innovation processes is strictly related to a learning process within an organizational culture that embraces innovation [Høyrup, 2012]. [Price et. al, 2012] concludes that the learning process within an organization and keeps continuing regardless of the disbanding of teams within an organization.

Therefore the main topic and objective for this research is the following:

Development of a conceptual framework on rewarding failure in

innovation attempts as an incentive for employees with outsets

in the construction industry

Due to the fact that the topic is extremely ambiguous and extending over various disciplines, the following research questions [RQ] were answered in order to comprehend a large theoretical base of knowledge combined with real‐life examples:

RQ1) Is rewarding failure done in other industries and if so, how is it done?

RQ2) How can the construction industry learn from other industries by taking example?

By answering these research questions, the thesis investigates across various disciplines, by using different research methods. In order to ensure research objectiveness, trustworthiness and the reasoning, scientific approach and methodology will be explained in the next chapter. The overall scope in answering these research questions is to comprehend a large database of knowledge, so that the concepts and the theories presented can develop further into a framework. This is also sustained by [Silvermann, 2006].

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1.3 DEFINITIONS, DELIMITATIONS AND CLARIFICATIONS

This section contains essential definitions and clarifications of various key terms which are used

across this thesis. As they are used in a general context, but with a specific scope, their definitions

and clarifications are important to ensure the reader understands the perspectives in which they

are used.

“Innovation is the process of making changes, large and small, radical and incremental, to

products, processes, and services that results in the introduction of something new for the

organization that adds value to customers and contribute to the knowledge store of the

organizations.” [O'Sullivan & Dooley, 2009, p. 5]

By using this, the research is widened and various types of innovation can be discussed, but the

research cannot go out of topic by addressing clarifications or add debate on whether one

process or another can be considered as innovation. Any small value adding change added to a

company or any attempt to do so can go under the term innovation. To reinforce this, the main

starting point in defining innovation is called upon: “innovation is novelty that creates economical

value” [Schumpeter, 1934].

“The term "incentive" implies a diverse set of meanings. The literal definition states that an

incentive is something that inspires action. In terms of the construction industry this definition is

translated into attempts to increase production or performance in return for increased

psychological or material rewards.” [Liska & Snell, 1992]

Motivational factors, sources of motivation and incentives were considered congruent terms in

this research. As explained by [Liska & Snell, 1992] incentives are attempts of increasing

production or performance in return for psychological or material rewards. Therefore they have

the same underlying meaning as motivational factor and source of motivation

In this Thesis, the term “phenomenon” has two implications. When sources were referenced, it

related to the theory. Then it was used outside that context, it implied the phenomenon of

“rewarding failure”

The main delimitation of this thesis can be considered the scarce data received from the units

within the case study. Steps were undertaken to ensure that the methodology is to be followed

through, however the method had to be shifted ultimately.

The second delimitation of this thesis was the time‐frame and limited resources in conducting

this research. The limitations were out of the researchers’ possibility of altering.

7

1.4 THESIS STRUCTURE

This thesis is based upon a collection of papers, where the important elements of the research

are based on the papers2 and annexes that contribute each to the development of the chapters.

The structure of the thesis is based on a main report and three appendixes plus annexes. The

main report summarizes the research in terms of introduction, research questions, research

design and the research conclusions. The appendixes comprise the full descriptive papers with

the data and the methods for collecting, conducting and analyzing it. The annexes comprise the

step by step process of what has been done in regards to the development of the papers and the

Main Report.

The structure of the thesis is divided in the following chapters:

CHAPTER 1 – INTRODUCTION

The introduction chapter presents the background and motivation for the thesis, the research

background, the proposal for the final topic, research questions and the definitions and

clarifications of some important terms. The chapter is based on the steps detailed in Appendix A.

CHAPTER 2 – RESEARCH DESIGN

This chapter presents the overall research design consideration, the philosophical considerations,

and the final research design with a step by step description of the Master Thesis project.

CHAPTER 3 – DEVELOPMENT OF A BASE OF KNOWLEDGE

This chapter contains the main research conducted in this thesis. Each sub‐chapter deals with the

main objectives of the thesis, presents the findings, and draws partial conclusions related to the

research questions. The papers on which this chapter is based are Appendix B and Appendix C.

CHAPTER 4 – PROPOSAL OF A CONCEPTUAL FRAMEWORK

This chapter contains the overall proposal of a conceptual framework, derived from the findings

and partial conclusions drawn from chapter 3 cf. also Appendix B and Appendix C.

CHAPTER 5 – CONCLUSIONS AND PERSPECTIVES

Finally, the conclusion chapter’s purpose is to conclude the overall findings of the research. The

chapter gives at the end some overall perspective on the research and where further research is

needed.

2 In this thesis structure, papers refer to the working papers, cf. Appendixes A to C, related to the paper‐based thesis. Appendix A is a working paper and does not contain the specific elements of an IMRaD structure. Articles refer to literature published by other authors and used in this research.

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CHAPTER 2. RESEARCH DESIGN

The conducted research is based on philosophical assumptions, which shape how the research is

performed. The philosophical approach affects the choice of how the research design is made,

based on what considerations. In this chapter the scientific paradigm, key concepts of ontology,

epistemology and methodology are presented which have served as a groundwork for the

research design as an overall. Together with the research design, the applied methods for

collecting and analyzing data are presented, and the steps taken to ensure the credibility and

trustworthiness of the data.

2.1 SCIENTIFIC PARADIGM

In any research, the scientific paradigm occupies an important role in how the research is

performed. According to Kuhn [1977], "A paradigm is what members of a scientific community,

and they alone, share". However, the original explanation of Kuhn has shifted in recent times.

The scientific paradigm applied to any paper is considered to be the researcher’s basic beliefs –

how he perceives the world [Guba and Lincoln 1994]. Given that, Heron and Reason [1997]

essentially added one more paradigm based on arguing that the “constructivist position fails to

account for experimental knowing”. The initial basic beliefs of Alternative Inquiry Paradigms by

Guba and Lincoln [1994] are positivism, postpositivism, critical theory et al., constructivism and

participatory being the contribution of Heron and Reason [1997].

Guba and Lincoln [1994] argued that the inquiry paradigms are highlighted by three interrelated

and fundamental questions. The ontological question “what is the form and nature of reality and,

therefore, what is there that can be known about it?” the epistemological question “What is the

relationship between the knower or would‐be knower and what can be known?” and finally the

methodological question “How can the inquirer […] go about finding out whatever he or she

believes can be known?”

Figure 2.1 – Basic beliefs of Alternative Inquiry Paradigms – Updated [Guba & Lincoln, 2000: pp.168]

9

However, there is no clear definition of these “paradigms”. The inquiry paradigms of Guba and

Lincoln could be argued that they are more approachable to social science study, due to several

referrals as to “social scientists use the main philosophical concepts in very different ways”

[Erikssonn & Kovalainen, 2008]. A different option to the Alternative Inquiry Paradigms [Guba

and Lincoln 1994], is available for research conducted within business areas. There are

alternatives such as [Arbnor & Bjerke, 2009] which define an operative paradigm instead of the

traditional, more commonly adopted Inquiry Paradigms. They, [Arbnor & Bjerke, 2009] motivate

their contribution to methodology studies by arguing on the fact that “an operative paradigm

relates a methodological view to a specific study area. […] It consists of two important parts:

methodical procedures and methodics. […] In our opinion, one cannot talk about a methodology

if the components mentioned above are merely described separately.” [Arbnor & Bjerke, 2009]

[Arbnor & Bjerke, 2009] argue on the premises that there has to be a difference between the

paradigm and the way it is applied. While [Guba & Lincoln, 1994, 2000] come with some

established set of rules, [Arbnor & Bjerke, 2009] allow through the Operative paradigm a more

open groundwork for the researcher to express his scientific approach in accordance to his topic.

Figure 2.2 – Theory of Science and Methodologuy [Arbnor & Bjerke, 2009: pp.168]

Although, it is acknowledged the valuable contribution of Arbnor and Bjerke, this research is

going to use as defining the philosophical approach, Guba and Lincoln’s Alternative Inquiry

paradigms due to the following consideration:

Since Guba & Lincoln’s Inquiry paradigms are more close to the social science research topic, and

the theme is into extensive qualitative research in analyzing the phenomenon of “rewarding

failure as incentive for employees” the theme is somehow drawn closer to Guba & Lincoln, than

Arbnor & Bjerke.

10

Going back to [Guba & Lincoln, 2000] the Inquiry paradigms3 need to be presented before the

choice of philosophical stance is defined. A short note on the Inquiry paradigms is that they are

defined by the three fundamental questions as [Guba & Lincoln, 1994] argue.

By framing the three fundamental questions into the a table [cf. Fig 2.1], combined with the

inquiry paradigms, positivism can be defined as so that the knowledge on the world or reality

cannot be influenced by the investigator, and that the investigator and the “object of

investigation” has to be treated as a separate entity. Positivism is usually attributed as a

philosophical stance to research conducted in a quantitative manner where hypothesis are

elaborated and empirically tested for validation [Guba & Lincoln, 1994]. Postpositivism can be

argued as a loosened version of positivism but where critique is included against the basic version

of positivism [Erikssonn & Kovalainen, 2008]. Critical realism refers to a reality that “once existed

but it was shaped by a congeries of factors and then crystalized in a series of structures that now

are considered “real” [Guba & Lincoln, 1994]. [Johnson & Duberley, 2000] suggest that critical

realism can be used in multi‐methodological approaches, both qualitative and quantitative. On

the other hand, based on the assumption that the human mind being limited and flawed [Guba

& Lincoln, 1994], [Nygaard, 2005] draws perspectives on the problem that this can reflect in the

researcher’s objectivity towards the studied phenomenon or topic. Therefore in general it is more

attributed to the use in qualitative research. Constructivism is defined by not having a general

“reality” which cannot be argued for. Constructivism implies variations of reality, in multiple

constructions based on experiences, meanings and social constructions. The constructions are

simply less informed and/or sophisticated and also alterable as their various realities. [Guba &

Lincoln, 1994]

2.2 ONTOLOGY

Ontology can be defined as the perception of reality, where in positivism it is realist or “naïve

realism” perspective, in postpositivism critical realism has been the reality, in critical theory a

virtual reality or historical has been the assumed reality, modified by factors and crystallized over

time and lastly in constructivism relativism has been the assumed reality. Specifically constructed

‐ in accordance to the view and meanings or participants. [Blaikie, 1993]

My philosophical stance in this research is constructivist. I believe in a reality that is dependent

of people and groups, either organizations or research groups and their different meanings;

where social, cultural, ethnic etc. values are at the core of one’s “constructed reality”. The

constructivist approach was selected, due to its allowance of creating an independent value‐free

world. My choice of selection can be also traced back in literature and argued by the following:

3 The participatory paradigm, contribution of [Heron & Reason, 1997] has been intentionally left out. The reason behind this is that delimitations imposed by context of the researcher in conforming to rules. The Curriculum for Study Program does not allow that much subjectivity to be present.

11

“Geertz’s (1988, 1993) prophecy about the “blurring of genres” is rapidly being fulfilled. Inquiry

methodology can no longer be treated as a set of universally applicable rules or abstractions […]

is inevitably interwoven with and emerges from the nature of particular disciplines […] and

particular perspectives.” [Guba & Lincoln, 2000, pp. 164]

2.3 EPISTEMOLOGY

The epistemological question has the purpose of defining how can knowledge be produced and

accounted for by the researcher. The main difference is that while selecting an inquiry paradigm

and its accounted for ontological implication, the research cannot take place by shifting between

different epistemological stances while having a pre‐defined ontology [Guba & Lincoln, 1994].

This means that since in this case a constructivist approach has been selected and the ontology

defined as relativism, the epistemological stance cannot be objectivist, as in a positivist

approach. This simply means that the findings are considered “created” as shaped by the context

and the reality surrounding them.

Starting from there, the research was based on qualitative research, and therefore different

perceptions from different source/actors. This contains several “realities” according to the

sources values and it is acknowledged that the knowledge found and framed could not exist

without the individuals and their values.

2.4 METHODOLOGY

Methodology is the frame that guides the researcher in finding his answers. Again, as literature

shows, the methodological stance cannot be argued for, nor changed, once the inquiry paradigm

has been selected and ontology and epistemology alike [Guba & Lincoln, 1994]. This does not

mean that knowledge cannot be comprehended outside the selected “reality”. It simply means

that studying a certain problem, a research needs to be defined as qualitative, quantitative or

mixed‐methods. [Creswell, 2009] accounts for a constructivist approach being solely attributed

to qualitative approaches, however research shows that comprehending basic concepts through

deep qualitative methods [Burgess, 2004], can be verified later by quantitative study [Have,

2004].

While establishing the purpose and the research questions, the researcher must ask himself

about what methodology of conducting the research he will select. If the conclusion is that a

deeper understanding of the topic at hand is needed, then the qualitative research is the best

option. [Irby & Lunenburg, 2008].

[Creswell, 2007], argues:

“A qualitative study is defined as an inquiry process of understanding based on distinct

methodological traditions of inquiry that explore a social or human problem.”

12

Researchers, who engage in this form of inquiry, support an inductive style, a focus on individual

meaning and the importance of altering and rendering the complexity of a situation. [Creswell,

2007]

[Guba & Lincoln, 1994], argue that the methodological question does not account for the

methods used. Methods have to be embedded into a research design and besides the

philosophical implications, the research problem defines also the path towards a qualitative,

quantitative or mix‐method approach [Creswell, 2009]

By taking the research questions into account, they contain enough evidence to show that the

research is an exploratory one, in search for understanding, when the researcher does not know

variables which can be exanimated, there is no theory, or the theory existing does not apply to a

particular group/area which is a pre‐requisite. [Morse 1991]

This part is concluded by adding the methods of conducting this research into the research design

and their relevance to the research.

2.5 RESEARCH DESIGN

Based on the philosophical position, the considerations in regards to the research paradigm, and

the research questions, the chosen methodological approach as a qualitative one, the research

design was undertaken as an exploratory case study with multiple units within the same

organization. However, there is also a comparative analysis which should be accounted for. Even

though comparative analysis is closely related to Grounded Theory cf. [Glaser & Strauss, 1967],

the research was not conducted as such. The arguments for this are presented in the discussion.

This thesis has been conducted in a 5 steps approach, each step contributing to the development

of the thesis. For every step the overall description of the contribution made is shown, the

method for conducting the research and the output in the form of Research Questions or

Appendixes and Annexes.

Table 2.1 – Research Design of the thesis in five steps

Step Method Output

Introduction and Problem Formulation This step has been the initiation step in conducting this research. Testing the literature, defining the objectives and the research problem

Literature review Analytical: Content analysis

Introduction and Problem formulation Appendix A Annex A 1.1 Annex A 1.2

13

Scientific Paradigm, Methodology and Research Design The second step contained defining the philosophical approach of this research, the methods for conducting it, and the Research Design of the Thesis

Literature review Synthesis

Research Design

Development of a theoretical base of knowledge for “rewarding failure” The third step was the Development of a Theoretical base of knowledge for possible implementations of “rewarding failure in innovation attempts” within the construction industry by taking examples from other industries

Literature review Case study Comparative method Analytical Content analysis Empirical Interviews Synthesis

RQ 1 Appendix B Annex B 3.1 Annex B 3.2 Annex B 3.3

Out setting the theory into the construction sector The fourth step was the Development of a larger Theoretical base of knowledge for possible niches of implementing rewarding failure in the construction sector by a historical example of the application of LEAN Construction and EDI

Literature review Analytical Content analysis Synthesis

RQ 2 Appendix C

Final conclusions and accumulation of knowledge Identification of key common mechanisms – Conceptual model

Synthesis

Research conclusions Development of a Conceptual Framework

14

A perspective that has not been tackled yet is the reasoning in this research. Essentially there are

two basic methods of reasoning. Inductive and deductive reasoning; both have applications in

research but where inductive reasoning is more open‐minded, deductive reasoning is more

narrow and concerned with testing hypothesis or theory.

The reasoning in this thesis is both inductive and deductive. While the applicability of inductive

reasoning is more related to the study case, the comparative analysis, the interview and content

analysis; deductive reasoning appears in testing the literature4 for various signs or gaps, where

applicability of an incentive system could take place.

Following the reasoning method in this research, a description of the steps is necessary:

Step 1

The first step in this research was an initiation step. The exact steps of the process are

summarized in [Appendix A – Methodology for Introduction]. In establishing a proper research

ground and topic, several issues were addressed. First of all, the initial idea of research came

from an external source [Sørensen, 2015]. Then, the construction sector general status was

tested in terms of innovation, and possible ideas were brainstormed of were answers could be

found. The methods used in this section was literature review and content analysis. The

reasoning in this part was both inductive and deductive since the overall purpose was to establish

a groundwork and test the current situation of the industry. The output were the research

questions and Appendix A – Methodology for Introduction.

Step 2

The purpose of this step was to establish the philosophical stance, the paradigmatic implications,

and to create a research design for conducting this thesis based on the information obtained. The

output of this step was the research design.

Step 3

Here, the first research question was undertaken in the study. It comprised of testing the

theoretical and practical landscape of “rewarding failure as incentive for employees”. The exact

steps of the process are explained in [Appendix B – Rewarding failure in innovation processes. An

incentive program]. The overall purpose was to answer RQ 1. The reasoning level in this step was

both deductive, but by “testing the literature” and inductive due to inducing from the empirical

data gathered. First, the literature was tested for potential sources of data collection from real

cases. Second, once an organization has been selected, steps were undertaken in establishing

contact and obtaining data, by an exploratory case study with multiple units. Third, a comparative

analysis was made to establish and deduce several reoccurring themes from the data collected,

4 Although literature attributes deductive reasoning to testing a hypothesis or theory, it should be emphasized that it is literature that is tested, not theory. The amount of literature present in rewarding failure does not constitute in my opinion a theory.

15

and fourth, a synthesis was done to develop the theoretical base of knowledge. The output was

Appendix B, and a clear answer to RQ 1.

Step 4

Step 4 comprised of an extensive literature review and content analysis. The exact steps for

conducting the research can be seen in [Appendix C – The possibilities of the construction

industry of learning by example]. The purpose of this working paper was to answer RQ 2. First,

the identification of literature was necessary for obtaining credible data. The reasoning level in

this step was inductive. Once literature has been reviewed, content analysis revealed the

potential areas for implementing a new incentive program; and how the construction industry

learns a different approach but still with the same principles and the same methods. The second

step was conducting an extensive analysis of where could an incentive system take place, in what

type of organizational setting, and how this is relevant to the construction industry by previous

implementations. The final step was synthetizing the findings into a larger theoretical base of

knowledge, where the incentive program could find its outset in the construction industry, by

using the industry’s current situation and advantages. The output was a clear answer to RQ 2

and Appendix C.

Step 5

The final step of the thesis concluded with the accumulation of knowledge gained from the

research through the steps described above. The reasoning level in this step was inductive, due

to the accumulation of knowledge. A conceptual model for implementation of a new incentive

system in an organization was proposed and the conclusions were made.

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2.6 ASSESMENT OF THE RESEARCH DESIGN

Validity and trustworthiness is an important part of any research. The correct judgment of one’s

assumptions, data collection, and data analysis reflects on the overall research. The steps for

conducting the assessment of the research design are based on [Guba & Lincoln, 1981; Krefting

1991].

Step 1 – Introduction and Problem formulation

Credibility Triangulation of sources

Transferability Not applicable

Dependability Dense/thorough description

Confirmability Triangulation of data/sources Reflexive analysis

Step 2 – Scientific paradigm, methodology and research design

Credibility Peer‐reviewed

Transferability Not applicable Dependability Dense/thorough description Confirmability Triangulation of data/sources

Reflexive analysis Step 3 – Theoretical landscape for “rewarding failure”

Credibility Triangulation of sources Transferability Nominated sample

Dependability Dense/thorough description Confirmability Triangulation of data/sources

Reflexive analysis Step 4 – Out setting the theory into the construction sector

Credibility Triangulation of sources Transferability Not applicable Dependability Dense/thorough description Confirmability Triangulation of data/sources

Reflexive analysis Step 5 – Accumulation of knowledge and final conclusions

Credibility Triangulation of sources Transferability Dense description Dependability Dense/thorough description Confirmability Triangulation of data/sources

Reflexive analysis

Table 2.2 – Applied techniques for ensuring trustworthiness and validity

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CHAPTER 3. DEVELOPMENT OF A THEORETICAL BASE OF

KNOWLEDGE

In this chapter, all of the main research carried out to develop a conceptual framework on

rewarding failure in innovation attempts, and the way it was outset to the construction industry,

is presented. The first part of the chapter has the purpose of answering RQ 1 – Is rewarding failure

in innovation attempts done in other industries, and if so, how is it done?. The second part of the

chapter has the purpose of answering RQ 2 – How can the construction industry learn from other

industries by taking example?

This chapter contains the main research conducted in this thesis. The papers on which this

chapter is based, are Appendix B and Appendix C. During the chapter, the different methods and

the methodological approach cf. Table 2.1 are applied.

3.1 REWARDING FAILURE IN INNOVATION ATTEMPTS AS AN INCENTIVE SYSTEM

This part of the thesis, covers the first research question [RQ 1]:

Is rewarding failure in innovation attempts done in other

industries, and if so, how is it done?

To understand better the concept behind an incentive system as “rewarding failure” and to test

the concept, a theoretical landscape was constructed through literature study. This has been

done, to gain a theoretical perspective on the topic and to obtain knowledge of industries and

organizations with this type of incentive system. The applied methodology was a case study with

multiple case units [Yin, 2009], and a comparative analysis [Glaser & Strauss, 1967]. For the full

work of this research, see [Appendix B ‐ Rewarding failure in innovation processes. An incentive

program].

3.1.1 TESTING THE THEORETICAL AND PRACTICAL LANDSCAPE OF THE TOPIC

“REWARDING FAILURE IN INNOVATION”

In organizations of any type, innovation is slowly becoming a necessity for survival on the market.

Innovations, of any nature have shaped the modern management [Hamel, 2006]. Testing the

theoretical and practical ground of “rewarding failure in innovation attempts” implied both a

collection of empirical data, and literature review. The literature review process involved both a

18

collection of important articles by following [Levy & Ellis, 2006] steps, and content analysis. The

exact process can be seen in [cf. Annex 3.1 – Steps for data collection]

3.1.2 THE THEORETICAL LANDSCAPE OF THE TOPIC “REWARDING FAILURE IN

INNOVATION”

Through literature analysis one important article presented a case study on “rewarding failure”

at BMW factory in Regensburg, Germany. The relevance of this article is tied to the findings

presented.

[Kriegesmann et.al, 2007] developed a model on “creative failures”. The model draws some

perspectives on what types of reactions should be appropriate from the management according

to the errors.

Figure 3.1 – Flops, blunders and creative errors: types of errors, causes and consequences

[Kriegesmann et. al, 2007]

Their findings are based on the case study conducted at BMW, where a system of “Error of the

Month” was implemented, but was dropped due to management support. However, the relevant

aspect was that “creative errors” or “successful errors” were rewarded with a symbolic prize,

instead of being punished. The reasoning behind is:

“Error tolerance” should be replaced by a differentiated (indeed intolerant!) handling of

deviations from routine processes.” [Kriegesmann et.al, 2007]. The point was that an employee

who disregards to a certain extend the organization’s policy towards innovation processes, by

19

taking a calculated risk should, in the event of failure not be punished but, rather encouraged to

further take calculated, sensible risks, in a spirit of optimism.

3.1.3 PARTIAL CONCLUSION

[Kriegesmann et. al, 2007] conclusions are that:

Behavioral latitude must be ensured so that innovative forces can be freed from routine

activities and decoupled from rigid structures. Similarly, resources need to have space

from counterproductive control and regulatory systems.

However this latitude can quickly degenerate into “a playground” unless the incentives

related to the tasks itself and their implementation are of a sensitive and careful manner.

[Kriegesmann et. al, 2007] recommend “upward career mobility or the prospect of

challenging and rewarding projects in the future”

Another important conclusion not really underlined by the case study is the fact that instead of

a financial reward, a personal present was awarded to emphasize the commitment. Further

literature showed, that a financial incentive system is to be used cautiously even in successful

implementation cases, due to negative outcomes [Georgellis et.al, 2011; Bysted & Jespersen,

2014].

The next step of the research was to approach an organization which could provide empirical

data in the form of semi‐structured interviews, in order to conduct the case study through

appropriate methods.

3.1.4 TESTING THE PRACTICAL LANDSCAPE OF THE TOPIC “REWARDING

FAILURE IN INNOVATION” – CASE STUDY AT TATA GROUP

This section, follows up the information gathered through literature review. The applied

methodology in this part of the thesis, as explained in [cf. Sect. 2.5, Step 3] is an exploratory case

study with multiple case units. The full collection of results can be seen [cf. Appendix B]. The

complete process, step by step can be seen [Annex 3.1].

TATA Group, with over 100 independent operating companies is a leader in the corporate world

and has a program which fosters innovation processes within the organization, called InnoVista.

[TATA InnoVista]. The program has a range of awards, which can be defined as incentive

mechanisms meant to encourage the innovation process within the organization. The case study

has focused on one type of award – “Dare to Try Award”.

“‘Dare to try’ award category of InnoVista, which recognizes sincere and audacious attempts at

innovation that failed to get the desired result. […]The growing number of entries in this category

(from 12 in 2007 to 174 in 2014) indicates that we have been successful in encouraging people to

experiment and innovate.” [Gopalakrishnan, 2014]. The award was created based on the same

20

literature and case study presented before, so it was considered to be even more relevant to the

thesis purpose of studying this phenomenon. The two case units are Jaguar Land Rover Ltd.5 and

TATA Consultancy Services.6

3.1.5 CASE STUDY RESULTS – THE PRACTICAL LANDSCAPE

The following section will present the findings concluded through the case study. The two sets of

answers from the case units are summarized below:

Jaguar Land Rover Ltd.

“Daring to Try” without fear is helpful as a precursor to innovation – taking chances.

The recognition of “failure” in “Dare to Try” is mostly after the event. Therefore it does not contribute in developing an innovation culture directly.

People apply for the award in order to make from failure “a success” but they rather have succeeded in the first place.

“Dare to Try” should be a motto of an innovation strategy and should be rewarded directly.

Companies prefer “low hanging fruits” but they do not take chances by doing so

The biggest issue is to resource “Dare to Try”

TCS (TATA Consultancy Services)

Dare to Try rewards failure and thus encourages risk taking. Risk taking is a precursor for a culture of innovation.

Most companies want to progress on assured success only.

It requires management support.

The ideas are judged for recognition based on their effort.

The team should also plan going again for it.

“Dare to Try” is mostly used to attract management attention and revive failed projects

“Dare to Try” should not be necessary a motto for an innovation culture but an innovation culture should accept failure as a pillar to success rather than punish it.

The biggest setback of Dare to try is that unless this process is continuing, failures are hidden and it causes deterioration of the innovation culture.

The overall impression was that several themes were re‐occurring within the literature and the

themes emerging from the content analysis. Therefore, the next step was made as a

methodological approach with the objective of testing both the theoretical landscape and the

practical landscape. This has been done for a better comprehension and extraction of key

5 http://www.jaguarlandrover.com/gl/en/ 6 http://www.tcs.com/Pages/default.aspx

21

mechanisms for how an incentive system such as “rewarding failure within innovation attempts”

could be developed more.


By applying a Grounded Theory methodology such as comparative analysis [Glaser & Strauss,

1967]7, the answers from the case study were then used together the content analysis from the

literature study [Kriegesmann, 2007]. The questions asked in the interviews were attributed an

answer from the two case units, and a generated impression of what the answer is from the

literature review.

The full comparative analysis can be seen in [Appendix B].

The generated themes were somehow in agreement between the sources, however

disagreement also occurred in two cases and two results need more extensive research. The

generated themes were coded into mechanisms and challenges. These results are summarized

below:

Mechanisms for conducting an incentive program such as “rewarding failure”

Innovation culture

Management support

Effort recognition

Employee perception

Recognition of failure

Challenges for conducting an incentive program such as “rewarding failure”

Continuous management support

Behavioral latitude

It should be noted that the management support even though it is a mechanism it also has to be

considered as the biggest challenge. Without management support, literature supports that such

an incentive program fails [Kriegesmann et.al, 2007].

The discovery of these key mechanisms and challenges faced by the adoption and/or rejection of

an incentive system such as “rewarding failure” was the objective of RQ 1. Therefore the research

continued in search of obtaining an answer to RQ 2 for developing the conceptual framework,

which was the thesis’ ultimate purpose.

7 A very important note. Although [Glaser & Strauss, 1967] define this methodology as that the collected data is compared, coded, and re‐coded again; in this situation the data was coded into themes once. Second of all the data collected from the literature review is not the collected data from the case study as [Glaser & Strauss, 1967] should be used for comparative analysis. It is merely data generated by content analysis.

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3.2 THE POSSIBILITIES OF THE CONSTRUCTION INDUSTRY OF LEARNING BY EXAMPLE

This part of the thesis, covers the second research question [RQ 2]:

How can the construction industry learn from other

industries by taking example?

The thesis covered so far, the theoretical and practical landscape of an incentive system within

the field of Innovation Management – Rewarding failure as an incentive for employees. Through

the analysis made in [cf. Sect. 3.1], mechanisms were identified, for the adoption and applicability

of this incentive system in an organization. However, the challenge of implementation within the

construction industry was undertaken in this section of the thesis.

The issue of implementation was undertaken as a qualitative study, based on [cf. Appendix B].

The full analysis can be seen also in [cf. Appendix B]. To advance in the study, steps were taken

to comprehend and develop a theoretical landscape for the applicability of the incentive system,

by the advantages of the construction industry in terms of learning as [Winch, 2003] argued.

In order to do this, a historical perspective on the adoption of a process already implemented

was needed to extract key mechanisms, which the construction industry needed for its adoption.

This step in the thesis is argued for in the next sub‐chapter.

3.2.1 LITERATURE STUDY In order to identify a system, which has been learned by the construction industry, the initial

information gathered in the background information was used. [Winch, 2003] accounted for the

learning industry, however, he also draw perspectives by comparison with the Lean processes

implementation within the construction industry. The literature search was conducted in order

to obtain theoretical data on the implementation process and to identify mechanisms which

contributed to the implementation, and barriers.

The literature study was done in three steps. The first step involving search strings in the

American Society of Civil Engineers database8 by combination of keywords with different filters

applied gave 260 articles. An important filter applied to the search was that the article type had

to be research article, peer‐reviewed, to ensure more credibility to the information that was

going to be extracted. Since the result was 260 articles, a rough selection was made to reduce

8 ASCE is an important database in the academic world. It contains peer‐reviewed articles, journals, conference papers of the highest academic quality.

23

the amount of articles. 45 relevant articles were then analyzed by an abstract review, and the list

was shortened down to 5 important articles.

The second step was to analyze the articles for their reliability by using the analytical program

NVivo. The steps are detailed in [cf. Appendix B]. The third step, was the literature review and

coding of themes from where key mechanisms were extracted which were considered beneficial

in the adoption process of Lean processes and also barriers.

3.2.2 ADOPTION OF LEAN CONSTRUCTION FROM THE MANUFACTURING

INDUSTRY9 In this sub‐chapter, the main considerations and important information regarding the adoption

of Lean processes are underlined.

More than being called a fundamental change in the industry, researchers agree that it is more

than that; it is “a paradigm shift” [Thaís et. al,2012; Tommelein, 2015]. Since these assumptions

are shared by researchers in their study conducted so far – to present date; it is strongly

recommended to consider the Lean Construction10 as the first real change done by the

construction industry by obviously applying principles derived from the manufacturing industry.

[Sullivan, 2011].

When a construction project delivers maximum value to the customer and in the same time it minimizes waste, it is considered “a lean project” [Ballard & Howell, 2003]. [Ballard & Howell, 2003] conclude that construction projects are temporary production systems and this can be traced back to initial research found, whether they are called complex or not [Ballard & Howell, 2003; Winch, 2003]. While visiting the Detroit Ford Plant, Eiji Toyoda, president of Toyota at that point, studying the outset of the plant, concluded that his company should be using all resources, including space, time, tools and human effort to a minimum; but in the same time maximizing the output [Sullivan, 2011]. The relation to the manufacturing industry for this reason is obvious. It was not the actual lean process derived from that point in time, but the lean philosophy.

3.2.3 THE THEORETICAL LANDSCAPE OF LEAN CONSTRUCTION ADOPTION The significance of conducting the literature review, was that it provided the opportunity to

encode themes according to the literature, and extract key mechanisms and barriers which the

Lean construction adoption faced and is still facing. The results of the literature review account

for the importance of determining which factors, were contributing to the adoption process. This

step was important because it provided the theoretical landscape of Lean Construction adoption

9 A small note is that “Lean construction refers to the application of lean thinking to the delivery of capital projects in the architecture‐engineering‐construction (AEC) industry.” [Tommelein, 2015]. 10 The term Lean construction was preferred for use in this thesis from this point, as opposed to Lean processes etc. While many processes and models have emerged from the adoption of Lean philosophy, an overall meaning was needed. [Ballard & Howell, 2003]

24

within the Construction industry. The significance of the theoretical landscape and the

mechanisms and barriers is that they contribute to a general overview, on what factors affect “a

paradigm shift” within the construction industry.

To be accounted for, the notion of “paradigm shift” is important because it encompasses a radical

innovation within the construction industry, an unusual tendency. [Slaughter, 1998] argued that

most of innovations happening in the construction industry are rather incremental. But the

adoption of Lean Construction can be extrapolated to the EDI theory were in a historical

perspective the adoption of such a system is a radical innovation [Kesting & Ulhøi, 2010].

3.2.4 PARTIAL CONCLUSION As explained, key mechanisms for the implementation of Lean Construction, and also barriers

were extracted through the literature study, where themes were encoded. The results are the

following:

DRAWBACKS:

The application of lean to an entire industry involved first and foremost the issue that the construction industry delivers different products with no clear definition of what is value for the customer, while the manufacturing industry can easily define the quality and value of a finite product for a customer.

The second issue encountered was the “control”. While construction industry evaluates results by looking backward to a project already finished and assessing the results, the manufacturing industry can overcome that issue by preventing and foreseeing any issue by looking forward, acting directly on the process [Sullivan, 2011]

Inexperience of work force

Resistance to change of employees

Unavailability of products on the market [Ozorhon et. al, 2014]

Misunderstanding of Lean principles; employees tend to misunderstand the whole point and they mix the meaning for example LPS (Last Planner System) with Lean thinking.

Lack of commitment from the foremen

Confusion of Lean as Building Information Modeling (BIM) combined with Virtual Design Construction (VDC) [Thaís et. al, 2012]

KEY MECHANISMS:

Project participants were integrated through partnering of the contractor with the user‐client

Commitment of leadership towards adoption of innovative measures [Ozorhon et. al, 2014]

Concept mapping to negotiate meanings (merely a tool for better communication)

Organizational learning

25

Action learning in the form of regular meetings – “problem solving method” [Hirota et. al, 1999]

One interesting remark is to be done though. While reviewing the literature for the needed information, an auxiliary information came through as well. As a precursor for learning, organizations need to “unlearn” outdated practices and discard them to make room for better ones. [Thaís et. al, 2012]

The partial conclusion presented here, is based upon an extensive literature study. The relevance

of the findings are connected to the next sub‐chapter, which tests Employee‐Driven innovation

for a potential fostering environment of “rewarding failure”

3.2.5 TESTING EMPLOYEE‐DRIVEN INNOVATION FOR A POTENTIAL FOSTERING

ENVIRONMENT This step, emphasizes an important part of this research. While conducting the literature review,

and testing the theory for possible niches of implementing an incentive program such as

“rewarding failure in innovation attempts”, the Employee‐Driven Innovation methodology came

in the literature several times. The choice for a further analysis and testing whether it is a

potential fostering environment is argued on several considerations.

Employee‐Driven Innovation, is an approach focused on innovation within an organization, by

using the employee’s spoken and tacit knowledge in terms of new products, methods, processes.

It focuses on the employees’ creativity, which by support from management and giving them

temporary authority, can develop new tools, structures, and processes to optimize within an

organization. [Sørensen, 2015; Høyrup, 2010]

Due to the fact that EDI is based on improving the innovation process within an organization, by

using the employees’ knowledge in generating innovative ideas, it has been considered an

approachable theory for a possible implementation of an incentive system such as “rewarding

failure in innovation attempts”. Another consideration is the necessity of support from

management. The literature study, shows evidence of a theoretical framework of conducting EDI,

content data from a framework for conducting EDI in a large project based organization within

the construction industry in Denmark [Sørensen, 2015], and experiences from the Norwegian

work life [Aasen et. al, 2012].

From a theoretical point of view, Employee‐Driven Innovation can have five main drivers in decisions about innovation within an organization [Kesting & Ulhøi, 2010]. Figure 3.2 illustrates how an ideal type organizational structure which fosters EDI would work.

26

Figure 3.3 – Ideal type organizational structure of conducting EDI [Kesting & Ulhøi, 2010]

Drawing some perspectives on the framework, there are four main essential conditions that need to be taken into account for, and needed for EDI to work.

Potential and limits of employee participation

Idea generation

Drivers of employee participation

Management support Having in mind these 4 essential conditions before going further with any analysis, one of the main drivers for employee participation in this framework are “incentives”. [Kesting & Ulhøi, 2010] argue that if the employees are not rewarded for their efforts, they have no extrinsic incentives to come up with ideas and only intrinsic incentives remain. From a more practical point

27

of view and in a shorter version of Figure 3.4 [Aasen et.al, 2012] present results concluded from an analysis into practical examples from the Norwegian work‐life. Their case study units were ranging from the construction industry to public administration and defense.

Figure 3.4 – Interrelated elements of EDI [Aasen et.al, 2012]

Another important literature study was an exploratory case study by [Sørensen, et.al, 2014]. They

key mechanisms extracted, are presented in [Sect. 3.2.6] together with a partial conclusion.


The key mechanisms, which are can be concluded from the literature review on EDI are:

Management – [Sørensen et.al, 2014] both through field testing, and literature review

concludes that this is the main theme important for a framework. As study points out,

management is required to be of constant support, skilful in communication, ready to

empower employees and recognition. [Kesting & Ulhøi, 2010; Aasen et.al, 2012] support

all this.

Knowledge sharing – indication in [Sørensen et.al, 2014] was that employees seemed to

agree when approached about it, that knowledge sharing would be a key factor in

conducting EDI, however no indication exists of employees doing so actively through

gathering of employees for example.

Organizational culture – not only [Sørensen et.al, 2014] found through research that

organizational culture is a key mechanism, but also [Kesting & Ulhøi, 2010; Aasen et.al,

2012] support this.

Employee motivation and education – as previously, all sources [Sørensen et.al, 2014; Kesting & Ulhøi, 2010; Aasen et.al, 2012] seem to agree that employee motivation is an important contributing key mechanism to conducting EDI. An important factor to be taking into account here, concluded by [Sørensen et.al, 2014] is that not all employees

28

are motivated by incentives, but that some employees could be satisfied with the current situation. This seems to be in some sort of alignment with [Kriegesmann et.al 2007] which argue that 10‐20% of employees venture into new territory. It can be extrapolated to incentives as well. Not all incentives work, and definitely not on all people.

Process – This area has not really been explored neither in literature, neither in practice. [Sørensen et.al, 2014] draw some perspectives on this, but more research is needed on how to give more importance to the processes needed in conducting EDI.

A partial conclusion that should be drawn here, is to account for the many inter‐related elements

which seem to always entangle in the various applications and frameworks of EDI. The relevance

of this step, was that through literature analysis, it is has been demonstrated how lean

construction adoption process does not seem to differ very much from the process of EDI. The

difference is, that the construction industry has already drawn conclusions and learned from the

applicability of Lean processes.

As history shows, Lean Construction has been learned by the construction sector and it is still in

process of being learned. By a comparison, EDI is in the state of Lean Construction some decades

ago, and this is a problem. But that does not mean, that there is no hope. As research has shown,

the construction industry can learn and so it did when it came to Lean principles even though the

process is far from completion. By looking into the problems arisen over time and in the

implementation process, much has been understood. Some of the key mechanisms related to

both the implementation of Lean and EDI interrelate and are:

All project participants need to be actively involved in any radical innovation. They need

to have first a theoretical background of what exactly they are trying to implement, and

then according to their roles, they have different needs for being motivated to participate.

Depending on the role of the participant within a project organization or set‐up, different

needs are in effect; employees need constant support from the management, and

feedback. Not only they need support, but they need to still be managed, while the

management loosens the chain and allows for some spare time on just individual learning.

As explained before, individual learning is organizational learning.

There is a great need for better communication tools/skills between the participants.

Misunderstanding of a certain process, literature shows, is quite common and therefore

should be avoided.

Last but not least, employees need extra motivation in the form of incentive systems from top

management in order to make sure that their attention is retained in face of the new challenge.

Through the study of chapter 3.2, RQ 2 was tackled and a clear answer would be that the key

mechanisms for the implementation of Lean, seem to align with the key mechanisms of

implementing EDI. Therefore, through a historical comparison, and by taking into consideration

29

the history of radical innovations in the construction industry, or “paradigm shifts”, potential

systems which could benefit the industry, can be learned from other industries.

On an even higher importance is that, “rewarding failure in innovation attempts” seems to have

a place within an EDI framework. The final chapter of the thesis, summarizes the partial

conclusions drawn from the research.

CHAPTER 4. DEVELOPMENT OF CONCEPTUAL

FRAMEWORK FOR THE IMPLEMENTATION OF AN

INCENTIVE PROGRAM WITHIN AN ORGANIZATION

This chapter, presents the accumulation of knowledge in the form of a synthesis based on chapter

3, cf. [Appendix B; Appendix C]. The chapter relates to all the partial conclusions drawn through

the previous chapter.

The construction industry is facing once again a paradigm shift. Innovation processes have

become increasingly more important due to the potential they have, and the industry is starting

to realize that.

This research was based on the premises that people and organizations are all different and

therefore their realities can differ. In the search for obtaining the best answers possible for the

two research questions, similar patterns have been re‐occurring and some were differing. The

process of answering the research questions, was interesting to follow, as it took the research,

through various disciplines in the search of developing a conceptual framework for the

implementation of an incentive program such as “rewarding failure”.

Through this research, some key mechanisms were identified for conducting an incentive

program such as “rewarding failure” [RQ 1]. Once this step was resolved, the dilemma of how the

construction industry learns was undertaken. Through an extensive literature study, the key

mechanisms extracted for the learning industry were related once to:

The historical perspective of how Lean Construction has been adopted by the

Construction Industry.

The key mechanisms for conducting EDI in an organization, and outsets in the

construction industry have been already defined.

The final step, is to synthesize these results into a conceptual framework for how “rewarding

failure as an incentive mechanism” fits the methodology of EDI.

30

4.1 A CONCEPTUAL FRAMEWORK FOR AN INCENTIVE PROGRAM SUCH AS

REWARDING FAILURE IN INNOVATION ATTEMPTS

The conceptual framework is the synthesis of both research questions, with its application in an

EDI Framework. It is considered as an incentive mechanism within an EDI Framework. The

research, on an overall does not account for in which type of framework this incentive system

could be fostered in. However, in acknowledging the existing frameworks, it has to be clearly

stated that all frameworks contain the mechanism of incentive systems for employees, so

therefore its applicability in one or another is not accounted for.

What is accounted for, is the proposal of a conceptual framework with the key mechanisms

required for this incentive to work, as research in [cf. Chapter 3.1; Appendix B] has concluded.

The following framework is proposed, and a detailed explanation of the mechanisms and thought

behind it is followed through.

Figure 4.1 – A conceptual framework for an incentive system such as “rewarding failure in innovation attempts”

31

There are two sets of mechanisms presented in the framework. Once, the mechanisms related strictly on the incentive program, as [cf. Chapter 3, Appendix B] has extracted from the conducted research, and the other set of mechanisms related as an intertwined system of factors which are present and are precursors for both the applicability of this incentive system, and the applicability of EDI and Lean philosophy within the construction sector. The mechanisms related strictly to the incentive program are:

Clear agenda on failure

It is an organizational responsibility that when having this sort of incentive program to make sure that there is a clear agenda or internal notes on how the company defines these innovation failures. A clear example of this, would be as suggested by [Kriegesmann et. al, 2007] a form of defining what types of failures or errors should have what sort of tolerance or sanction attached to them [See Figure 3.1] Another factor that should be clearly defined is that within a clear agenda on failure, a typology of assessing correctly these failures or blunders should be in place as well. Research shows that it would be negative towards the employees if they feel that they have not been judged correctly. [Kriegesmann et.al, 2007] give also insight into the fact that this careful examination of failures should be well planned, as to who is responsible for the program, judges etc. Effort recognition

Effort recognition, can be attributed solely to the motivation of employees. As [Liska & Snell,

1992] argued that within the construction industry the incentives are actions or attempts to

increase performance for return of psychological or material rewards; and as the study shows

similar patterns, several factors for ensuring effort recognition should be accounted for. While

researching on “Dare to Try” no financial reward has been attached to the prize, it is simply a

mere symbolic prize of thanking the employees for their bodacious effort. A small note on this is

that literature shows, that financial incentive programs can have negative effect [Georgellis et.al,

2011; Bysted & Jespersen, 2014]. And referring to [Deci et.al, 1999] on the shift from intrinsic to

extrinsic motivation and combined with the research that has proven that a financial reward

shifts the employees motivation from intrinsic to extrinsic [Burroughs et. al, 2011; Eisenberg

1999] is therefore recommended that no financial reward should be attached to the recognition

of failure, but it should be in the form of a prize or award. The study also showed that the

recognition of failure should have attached the possibility of reviving these failed attempts, a fact

that management should take into account.

32

The mechanisms that are related to both EDI, Lean and “rewarding failure”

Management support

The study, revealed as the most important key mechanism that management support is essential

for adopting such an incentive program. Even though there are a multitude of factors which have

not been accounted for in this research, the key factors ensuring that management support is

having an active role are: Ensuring proper communication, allowing time for employees to engage

in innovation processes and open minded attitude.

Innovation culture

The term of innovation culture appeared in this thesis quite often, and as data shows, it is one of

the main mechanisms driving the process. Innovation culture on the other hand has been

connected several times to the fact that is a precursor for innovation in any type of organization.

Having established that, and keeping in mind the organizational learning from the introduction

and the EDI process, several implications are attached. [Brandi & Hasse, 2012] attribute

repeatedly through their research that practice based‐learning within an innovation culture is an

essential factor or mechanism for ensuring an innovation process and reinforcing the culture of

innovation. Also, [Brandi & Hasse, 2012] attribute the interplay between managers and

employees to be of vital importance, and that this is one of the main factors from where an

innovation culture emerges.

Although the overall thesis accounts for these mechanisms as a synthesis, more research is needed on defining clear factors on management support in regards to this incentive process.

4.2 CONCLUSIONS AND PERSPECTIVES

This study, conducted as a Master Thesis in the field of Innovation Management within the

Construction Industry, has assumingly given a good theoretical overview, over many subjects

covering the field of innovation within the construction industry and not only, in general.

In depth, the thesis and the research on overall, tried to look into ways of exploiting a gap in

theory. The gap or dilemma; whether or not, innovation setbacks or failures should be rewarded,

within an organization has been at least initiated in the research field. Whereas [Kriegesmann

et.al, 2007] have made an important contribution to the field of innovation by their case study at

BMW, more extend research is needed into this topic.

The originality in this thesis consists that several applied methodologies were used in order to

collect and generate data. A note on [Chapter 3.1.6] is that even though the applied methodology

is derived from [Glaser & Strauss, 1967], the thesis on an overall cannot be considered under any

circumstance as being Grounded Theory. Had this research, the opportunity to collect more

empirical data from TATA Group, and/or from Google or 3M which allegedly have some incentive

33

system similar to the application of “Dare to Try” then perhaps a Grounded Theory methodology

could have been argued for.

On the other hand, there is no clear definition on the premises that one scientific article could be

considered “a theory”. However, the originality in the thesis lies also in this aspect, that it aligns

itself in the ranks of unusual research topics, but still as shown, quite important if we take intrinsic

motivation into account. Grounded Theory could be a research option for future studies in this

topic, since it can systematically generate theory based on empirical data.

On a last note, having the outsets in the construction industry was a necessary step. What cannot

be accounted for, is a specific type of organization within the construction industry which could

possibly foster such an innovative attempt such as “rewarding failure”. The background

information showed that in Scandinavia, mostly large companies are innovative and dragging the

industry forward. However, [Sexton & Barret, 2003] during their study excellent proof of how

small companies in the UK during 1999 delivered around 52% of the total amount of construction

related projects, therefore drawing the conclusion that innovation performance of small

construction firms improves the industry itself. Therefore their study, creates a now a dilemma

on which type of organization is the applicability of innovative systems as “rewarding failure”

within the construction industry, possible.

34

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1

DEVELOPMENT OF A CONCEPTUAL FRAMEWORK ON

REWARDING FAILURE IN INNOVATION ATTEMPTS AS

AN INCENTIVE FOR EMPLOYEES WITH OUTSETS IN THE

CONSTRUCTION INDUSTRY

APPENDIX LIST

Contents APPENDIX LIST ............................................................................................................................................ 1

Appendix A Methodology for introduction and problem formulation………………………………….. 3

Appendix B Rewarding failure in innovation processes. An incentive program ........................... 7

Appendix C The possibilities of the construction industry of learning by example .................. 22

3

Appendix A

METHODOLOGY FOR INTRODUCTION AND PROBLEM

FORMULATION

This working paper1 is based on a study on an article by [Levy & Lewis, 2006] on conducting literature review. The initial topic for the thesis has been proposed by Henrik Sørensen. This can be seen in Annex 1.1 ‐ Catalogue of Projects/Projektkatalog – Inspiration for the final Thesis/Inspiration til afgangsprojekter, Autum 2015/Efterår 2015, Rev. A, 17th of June 2015. The purpose of this working paper is to present the methodological steps used to perform an in‐depth analysis of the innovation topic with the end result of having an introduction and problem delimitation and formulation for the Main Report. As it has been suggested in the catalogue an area which was not researched is the idea of rewarding failure in innovation attempts. Therefore the purpose of the introduction and problem delimitation is to make a cross analysis of the innovation topic in the construction industry and to delimit clearly the innovation meaning. The process used is split into different steps: Identification of keywords on Rewarding failure in innovation theme based on prior experience. (Methodology: brainstorming) and follow‐up research.

1) Modify keywords into basic search strings combined with Boolean operators and initial search in Aalborg University’s Library Database2 with the keywords and basic search strings. The database contains scientific papers, thesis, books, etc.

2) Prior experience gained through review of different Ph.D thesis and Master Thesis reports were used to select a source for further reading and comprehension.

3) Using Levy and Ellis’s article [Levy & Ellis, 2006] a backward and forward reference search was used in these articles and projects to gain further insight and find potential important articles.

4) Review of articles in order to obtain proper insight into the current situation of the construction industry in regards to innovation in Scandinavia and to obtain a proper definition of innovation to be used for the research, and to find potential gaps in the literature to be exploited.

5) Writing the Introduction and Research problem and Research Questions

1 By paper, it refers to the working papers [See Appendix list] that the Thesis is built upon as a paper‐based thesis. The term article, refers to literature published by others and used in this research. 2 The University’s Library Database contains books, journals, and access to databases containing scientific papers, journals, publications etc.

4

1) Initial search in Aalborg University’s Library Database (Primo) with the following

keywords and/or search string:

innovation,

failure,

reward,

construction

innovation AND failure,

reward AND failure,

Innovation AND construction.

Attempt Database Search string Results Note

1 Primo innovation AND failure 3259 Only Peer reviewed

2 Primo reward AND failure 4638 Only Peer reviewed

3 Primo innovation AND construction

4277 Only Peer reviewed

Note: The search engine in Primo did not work as it should using truncation symbols such as “ or

? to rule in both singular and plural forms of words. However the search strings were combined

with the Boolean operator AND to give more examples.

2) Prior experience gained through review of different Ph.D thesis and Master Thesis

reports were used to select a source for further reading and comprehension

As the results were in the ranks of thousands, further trimming was required. This has been done

by using further constrain options in the search engine. Since the search strings were giving

results in the ranks of thousands, the research started with selecting one Ph.D thesis in the field

of Innovation Management. The Ph.D thesis selected was Development of an innovation process

for managing employee‐driven innovation – in a governmental client organization within the

Danish construction industry – Henrik Sørensen, 2015. This Ph.D thesis was selected as it

contained the initial topic as described in the introduction of this paper and it had direct relation

to the topic. It was considered a trustworthy source since it has been reviewed and approved, by

thus the initial topic of rewarding failure in construction innovation attempts being proved at a

higher academic level not really been researched.

5

3) Backward and forward referencing as described in [Levy & Ellis, 2006]

[Levy and Ellis, 2006] have developed based on previous research a system to obtain higher quality results in literature search. According to the same source [Levy and Ellis, 2006] “The process of going backward in literature can be divided into three specific sub‐steps: backward references search, backward authors search and previously used keywords.” The process used in this search was mostly backward references search and backward authors search. Previously used keywords on the other hand was not used; only later on after defining the final problem delimitation. According to the same source “the forward search can be divided into two specific sub‐steps: forward references search, and forward authors search.” [Levy and Ellis, 2006] The process of forward references search and forward authors search has been used in this particular approach due to the fact that, several authors kept re‐emerging and it was interesting to follow different articles, leading from one to another for a wider comprehension on the topic of innovation.

4) Review of articles in order to obtain proper insight into the current situation of the construction industry in regards to innovation in Scandinavia and to obtain a proper definition of innovation to be used for the research, and to find potential gaps in the literature to be exploited.

By using backward and forward referencing 10 to 15 articles were selected based on their abstract. In the abstracts and conclusions information was extracted for testing the availability of data and to ask critical questions in regards to if anybody has been in this field of research before and what is known already about this field of research. Once the initial setup and background data has been selected and reviewed, before defining the

final problem formulation and introduction it was imperative to take into account the potential

delimitations of the thesis in order to narrow down the problem and area to be researched by

applying the following process:

I) An initial research design was proposed and discussed with the supervisor. The

initial research design can be found in Annex 1.2 – Initial Research Design

The result was that the research area would be too broad to comprehend, collect and analyze

such data in a 4 month period, therefore the conclusion was that the research proposal should

be further trimmed and with a more specific focus, perhaps one hypothesis to be tested, only

two objectives out of the initial proposed to be further researched.

II) A search using different search engines and the initial articles was performed to

test any areas with potential for the initial objectives.

6

Since the initial objective and main thesis was how can rewarding failure in innovation be done

so that it is an incentive for employees; different online articles led to the selection of one

company to be investigated if possible and four articles where considered extremely relevant

with real‐life examples from the manufacturing industry. The company selected to be

investigated and questioned upon the topic was TATA Group, and the articles were referring to

BMW, where such a system has in fact been done before, but not in the construction sector.

The objective of this working paper was to present the steps in ensuring that the research

objective and problem can have some result. As it has been agreed in the initial meeting with the

supervisor, a clear answer to the defining problem is not mandatory however the methods

leading to an answer and discovering potential research areas are more important.

References

Levy, Y. & Ellis, T. J. (2006). A systems Approach to Conduct an Effective Literature Review in Support of Info Systems Research. Informing Science J., 9, 181 ‐ 212. Sørensen, H. (2015). Development of an innovation process for managing employee‐driven


Aalborg University Press

7

Appendix B

Rewarding failure in innovation processes. An incentive program

This is a working paper, and a part of the Master thesis “Development of a Conceptual Framework

on rewarding failure in innovation attempts as an incentive for employees within the construction

industry”. All additional information in regards to this paper are collected in [Annex B 3.1 ‐ Steps

for data collection]

The paper has the aim of investigating and answering the first Research Question:

“Is rewarding failure in innovation attempts done in other industries and how is it done?”

INTRODUCTION

The construction industry is considered rather slow‐paced, when it comes to innovation compared to other industries [Tatum, 1987; Winch 2003; Bygballe & Ingemansson, 2014]. [Bougrain et.al. 2010] give this conservatism of the industry the term laggard. A perspective that has not been really resolved, nor researched is the dilemma whether a failure in innovation attempts should be rewarded, still keeping in mind that employees need to rewarding or compensation for their effort, and motivated to contribute more to innovation attempts. [Sørensen, 2015]. Even bureaucratic old‐style organizations have shifted to the label of the learning organization, and their mission statements conjure up visions of creative renewal in order to survive in the ongoing competition for innovation [Kriegesmann et.al. 2007]. This is not the case for other industrial sectors; “innovative companies need to accept failure as price of playing the game – one cannot win if one doesn`t play” [Gupta & Singhal, 1993]. One could argue that “rewarding failure in innovation attempts” is an innovation in itself when it comes to incentive mechanisms. This is mainly because such a system is considered highly theoretical. However, as shown, “firms can improve performance by offering low‐powered rewards for the selection and implementation of employee ideas” [Baumann & Stieglitz, 2014]. In their paper, they make reference to companies who have tried a new incentive system approach, such as Google, 3M or TATA Group. The main purpose of the paper was to contribute to the development of the conceptual framework on rewarding failure in innovation attempts by establishing a close contact with one of these companies, make further research into their organization, their operating mode, and having an actual dialogue with them in order to collect data. The second purpose of this paper was to grasp a sufficiently large theoretical knowledge on the topic, from theory, literature and

8

research data. The paper does not cover only the question of how is rewarding failure done in other industries, but it also goes into sensitive aspects of an organization having an innovative incentive system. Having clear evidence that other industries/companies are having programs for rewarding failure, the research needs to take notice of how, and what are the effects and under what conjuncture this takes place.

METHODOLOGY

While establishing the purpose of the research and the research questions, the researcher must

ask himself about what methodology of conducting the research he will select. If the conclusion

is that a deeper understanding of the topic at hand is needed, then the qualitative research is the

best option. [Irby & Lunenburg, 2008].

[Creswell, 2007], argues:

“A qualitative study is a means, for understanding and exploring the meaning of groups or

individuals in a particular problem."

Researchers who engage in this form of inquiry, support an inductive style, a focus on individual

meaning and the importance of altering and rendering the complexity of a situation. [Creswell,

2007]

Having defined in the Main Report that the overall thesis is a qualitative study, the next step is to

identify the methodological implications of this paper. While taking Creswell’s assumption to the

point of referencing, several implications are drawn upon it:

The present study looks into and aims to understand a phenomenon that is more

social/human than organizational.

It will define emerging themes, through qualitative methods the key mechanisms of an

incentive mechanism such as “rewarding failure” in organizations

By asking “how” in the research question, the research takes a more qualitative approach

than quantitative; “quantitative research is a means for testing objective theories by

examining the relationship among variables. These variables, in turn can be measured”

[Creswell, 2009]

Having already defined a philosophical constructivist stance3 in the main report [See

Chapter 2, Main Report] at the beginning of the research, this aligns more with a

qualitative research approach. [Creswell, 2009]

3 The philosophical stance does not change from the main report to the papers. Although, in some situations the applied paradigm can be different from papers to the main thesis, in this research, the applied methodology did not account for such an approach.

9

Having established that the methodological approach for this paper is qualitative; an exploratory

case study with multiple case units methodological approach was chosen; the appropriate

methods necessary for conducting the analysis and answering the research questions have to be

explained:

Description Method Output

Testing the theoretical and practical ground of the topic “rewarding failure in innovation”. This has been conducted by brainstorming essential keywords and finding relevant articles across disciplines with the final purpose of finding a real‐life organization not connected with the construction industry where “rewarding failure in innovation attempts” was an actual process. Also, an important part was having a sufficiently large theoretical data on the topic to be able to formulate the questions for the interviews. [See Sect. 2 of this table]

Review of literature Backward and forward referencing Analytical: Content analysis

Annex A 3.1 – Steps for data collection TATA Group, Google X, 3M selected as to be approached for gathering qualitative data.

Exploratory case study with multiple units at TATA Group Once a sufficiently large database set of information has been gathered, and some potential companies revealed with the system in cause, they have been systematically approached with the proposal of collaboration. Thus, invaluable data straight from the source was gathered.

Empirical: Interviews Case study Analytical: Content analysis

Annex A 3.2 – Correspondence with TATA Group Part of Research Question 1

Comparative analysis on “rewarding failure”. This has been done in the form of a comparative analysis from three different sources of collected data. [Case study with multiple units, review

Analytical: Comparative method

Reinforce Research Question 1

10

of existing case study performed at BMW, see Kriegesmann et.al, 2007]

Development of a theoretical database The development of a theoretical database was the final step in conducting this research and to approach the research question. This has been conducted by the identification of key mechanisms of having a reward system on failure in innovation attempts through the data collected [see sect. 2 & 3 of Table 2.1]

Empirical: Synthesis

Research Question 1

Table 1 Research Design in four steps

Table 1 summarizes the framework of the research conducted in this paper and provides an

overview of, how each step is presented in the following chapter and how the research question

is essentially tied to the steps in the framework.

Step 1

This step was a test; a preliminary study where the research question has been submitted to a

content analysis through various articles. Key terms were defined according to the research topic,

and data extracted, tied to a possible organization that has adopted a “reward failure system”.

The keywords brainstormed and used as input were as follows:

Innovation

Failure

Reward

Incentives

A preliminary search in Aalborg University’s database portal4 gave a potentially important article.

The article belonging to [Kriegsmann et.al, 2007] was important in the research due to its further

implications.

Backward and forward referencing as described by [Levy and Ellis, 2006] was the research

method of obtaining necessary literature, which was necessary in this research.

4 The University’s Library Database contains books, journals, and access to databases containing scientific papers, journals, publications etc.

11

The first attempts in backward and forward referencing were as to obtain a large theoretical base

of knowledge into the topic, and once this has been established, three potential companies have

been selected for further approach: Google X, 3M and TATA Group. These companies have been

selected due to the emerging themes from the various articles reviewed.

Step 2

Once a number of articles have been gathered, and their content analyzed for emerging themes

and companies, Google X, 3M and TATA Group were selected for further questioning. In an

attempt of gathering more information, an approach has also been tried to contact Prof. Dr.

Kriegesmann for gaining further information on his work. However, this came with no result.

Google X, 3M were then thought of approaching for a collaboration. However, TATA Group has

been selected due to the reasons elaborated in [See Annex A 3.1 – Steps for data collection].

Briefly mentioned, TATA Group was selected due to their award called “Dare to Try” within

InnoVista Program. The initial thought and proposal was an interview over Skype; but this was

not possible due to the limitations from the company [See Annex A 3.2 – Correspondence with

TATA Group]. However, information was extracted in the loose form of written interview. Also,

information was also extracted as an additional information from TATA Group’s large database

of information available online besides the exploratory case study.

Step 3

Having obtained scarce information from TATA Group given the constraints; and having a

literature review in place, a comparative analysis was made in order to concur whether emerging

patterns and themes are similar from the collected data [Glaser & Strauss, 1967]. Once the

comparative analysis was made, the research went into the final step of answering the research

question and set‐up the ground for the conceptual framework within the main report by having

already an answer to the initial research question, and some patterns to work with, as to be

connected to the construction industry.

Step 4

This step concluded the research presented in this paper. The research question was given a clear

answer at this point, and the emerging and reoccurring information through the case study,

interviews and literature review were re‐organized for similar patterns which can be possibly

applied into the construction sector by one way or another. The overall aim was to test

theoretically the applicability of such a system, and provide credible and enough information for

the next research question to be undertaken in the report.

The reasoning in this paper is both inductive and deductive. The main difference between

inductive and deductive reasoning is the fact that while inductive reasoning is related more too

12

qualitative research, a deductive approach is aimed at testing theory.5 Had this research been

Grounded Theory then inductive reasoning should have predominated, however due to the large

mass of literature, a deductive reasoning was necessary.

A more detailed analysis on how the data was collected, and gathered, can be seen in [Annex A

3.1 – Steps for data collection]

RESULTS

TESTING THE THEORETICAL AND PRACTICAL IMPLICATIONS OF “REWARDING

FAILURE IN INNOVATION ATTEMPTS”

[Kriegesmann et. al] presents factually, based on literature, how zero‐error principles, combined

with established incentive systems actually hinder innovation, due to sanctioning of deviations

from norms, established in quality handbooks etc. The underlying principle which needs further

detailing is that there is a large deviation and difference between the meanings of “failures” in

organizations.

“Error tolerance” should be replaced by a differentiated (indeed intolerant!) handling of



taking a calculated risk should, in the event of failure not be punished but, rather encouraged to

further take calculated, sensible risks, in a spirit of optimism. Their experience dates back to the

90’s when in BMW, the automotive industry, the factory in Regensburg experimented with an

unusual, new incentive system, originally titled “Flop of the Month”.

The case study, is based on a program implemented between 1990 and 1993 at the BMW factory

in Regensburg, Germany and conducted by [Kriegesmann et.al, 2007]. The most important

information gained through the review of this article was Figure 1 presented on the next page:

5 Although literature attributes deductive reasoning to testing a hypothesis or theory, it should be emphasized that it is literature that is tested, not theory. The amount of literature present in rewarding failure does not constitute in my opinion a theory

13

Figure 1 – Flops, blunders and creative errors: types of errors, causes and consequences

[Kriegesmann et. al, 2007]

In the figure presented, [Kriegesmann et.al, 2007] argue on what can be considered a “creative

error” and what could be the reasons for failure. In their study, they also present a theoretical

approach to what types of reactions should take place according to the error type. While

sabotage is lying at the top of the list, with zero tolerance and full sanction, “creative errors” lie

at the bottom of the list with full tolerance and zero sanction.

[Kriegesmann et. al, 2007] conclusions are that:





related to the tasks itself and their implementation are of a sensitive and careful manner.

They recommend “upward career mobility or the prospect of challenging and rewarding

projects in the future”

Another important conclusion not really underlined by the case study is the fact that

instead of a financial reward, a personal present was awarded to emphasize the

commitment.

The incentive system described does not necessary mean that it is a theory. It is merely a

phenomenon described, and it required further extensive follow‐up research. As explained in

Step 2, TATA Group was selected for interviewing. The full content can be seen [Annex A 3.2 –

14

Correspondence with TATA Group]. The answers summarized from the two case units are the

following.


“Daring to Try” without fear is helpful as a precursor to innovation – taking chances.


People apply for the award in order to make from failure “a success” but they rather have succeeded in the first place.


Companies prefer “low hanging fruits” but they do not take chances by doing so

The biggest issue is to resource “Dare to Try”

TCS (TATA Consultancy Services)

Dare to Try rewards failure and thus encourages risk taking. Risk taking is a precursor for a culture of innovation.

Most companies want to progress on assured success only.

It requires management support.

The ideas are judged for recognition based on their effort.

The team should also plan going again for it.

“Dare to Try” is mostly used to attract management attention and revive failed projects

“Dare to Try” should not be necessary a motto for an innovation culture but an innovation culture should accept failure as a pillar to success rather than punish it.


COMPARATIVE ANALYSIS BETWEEN THREE TWO DATASETS AND CONTENT

EXTRACT

In order to comprehend better the results, the following table makes a comparative analysis

between three companies. Two of the companies are case units from the case study, and the

third company is content extract derived from [Kriegesmann, et. al 2007] case study. The method

chosen is described in Step 3 – Table 1. 6

The comparative analysis is based on [Glaser & Strauss, 1967].

6 For a better comprehension, both the questions and the replicated answers were written as they were addressed/received.

15

Question TATA Consultancy Services


Case study from BMW

Is an initiative as “Dare to Try” or “Creative Error of the Month” a precursor for an innovation culture or should it have a place once an innovation culture is established?

Dare to Try rewards failure and thus encourages risk taking. Risk taking is a precursor for a culture of innovation. Most companies want to progress on assured success only. It requires that the mindset of risk taking to be propagated throughout the organization and be supported by the management.

“Daring to Try” without fear (or being overly risk averse) is helpful as a precursor to innovation – in other words, taking chances.

This way of learning is more than individual learning – it is an element of a learning culture for innovation. Furthermore, our case study demonstrates that the implementation of an innovative initiative requires support and decisive action from people with power in the enterprise.

When does the recognition of “Dare to Try” or “Creative Error of the Month” happen?

The ideas are judged for recognition based on their effort, and where the teams were unable to overcome risks and roadblocks but the team should also plan going again for it, then is the recognition taking place.


‘‘This was an outstanding and bold idea, which was well planned, an excellent contribution! The initiative may have gone wrong, but it was worth the price’’. The employee received the ‘‘Creative Error of the Month’’ award, and a good bottle of Regensburg wine as a present.

In which way to employees use the award?

Is mostly used to attract management attention and revive failed projects

People apply for the award in order to make from failure “a success” but they rather have

An employee who disregards to a certain extend organization’s policy towards innovation processes by taking

16

succeeded in the first place.

a calculated risk, should in the event of failure not be punished but, rather encouraged to further take calculated, sensible risks, in a spirit of optimism.

Should “Dare to Try” or “Creative Error of the Month” be a motto for an innovation culture?

Dare to Try should not be necessary a motto for an innovation culture but an innovation culture should accept failure as a pillar to success rather than punish it.


See answer from Q1.

What is the biggest issue of “Dare to Try” or “Creative Error of the Month”?


The biggest issue is to resource “the daring to try”.

Behavioral latitude can quickly degenerate into “a playground” unless the incentives related to the tasks itself and their implementation are of a sensitive and careful manner.

Table 2 – Comparative method analysis

The columns in the table with the themes that have emerged similar have been colored in the

same pattern and are explained; for a better processing and understanding of the reader,

emerging patterns have been coded into a specific theme. Usually there was agreement between

the data, however, disagreement occurred in one two cases, and two results need more research.

17

Innovation culture ‐ Mechanism

The answers provided to the first question by all three data sources conclude that an incentive

system such as “Dare to Try” or “Error of the Month” is a precursor for an innovation culture and

that the implementation of such a system rewards failure in innovation attempts and encourages

a culture of “risk taking within an organization”; this also means that such an incentive system

needs propagation throughout the organization once established. The questionable part is that

in the fourth question, there is a difference in opinion between the two subsidies of TATA Group

whether “Dare to Try” should be a motto of an innovation culture or not.

Management support ‐ Mechanism

The introduction of an incentive system as “Dare to Try” or “Error of the Month” requires

constant support from the upper management. As already being offered both a direct answer

from TATA Group and an answer through content analysis, such a program cannot develop and

continue in an organization if it does not receive constant support and push from the top

management of the organization. Managers need to pay constant attention and to promote such

incentive programs, otherwise the counter‐effect is what happened at BMW, that once Gerhard

Bihl, the initiator of “Error of the Month” stopped working there, in a short period of time, the

program was dropped. [Bihl, 1995]

Effort recognition ‐ Mechanism

The effort into planning and developing an innovation is not to be judged nor punished. If

sufficient and carefully planned effort is put into a process, but which ultimately fails, the

employee should be rewarded for his effort as a motivation to keep trying to innovate.

Employee perception ‐ Mechanism7

Here, the literature does not really match with reality. As data collected from TATA Group

explains, employees tend to use this type of incentive for more “selfish” reasons than, more

driven towards an organizational improvement, as literature suggests.

Recognition of failure – Mechanism/Difference in opinion

The variation in opinion in this matter is interesting to be noticed. Some sort of disagreement

was expected and the fact that one subsidy of TATA Group has a different opinion then another

one is a completely acceptable fact. As literature suggested before, usually up to 10‐20 per cent

of employees venture into new types of businesses [Kreigesmann et. al 2007] therefore the

difference in opinion is explainable.

7 This mechanism needs extensive further research. More practical applications should be considered.

18

Continuous management support ‐ Challenge

It seems that the biggest obstacle faced by such an incentive program is continuous support from

management. Although the literature suggests another possible drawback of the system as a

main risk, in practical experience, the management from support is imperative for the program

to work. As explained above in the Management support theme, this risk that TATA Group

expressed their opinion on, has indeed already happened also in the case study at BMW. The

main difference is that the main drawback chosen by the researchers has a more theoretical

implication, which was not yet accounted for by any research in this particular topic.

Behavioral latitude – Challenge8

Unless precautious steps are made, this incentive type can quickly degenerate into a different,

unwanted process. [Kriegesmann et.al 2007] suggest that a “playground” is an undesirable

counter effect of empowering employees with too much freedom to work on innovative projects.

The conclusions that can be drawn from the comparative analysis are that on an overall perspective, the themes generated from the content analysis of the literature and added with the empirical data obtained from TATA Group match. Out of 7 generated themes, 5 themes have at least two out of three similar answers on the same topic from different sources. However, as seen, divergences have also occurred, and additional research themes are still to be looked upon.

DISCUSSION

In the following, writing the key perspectives drawn from this paper are summarized, together

with a discussion of the results from the methodological approach of conducting the research.

The research, in its quest to answer the research question of “Is rewarding failure in innovation

attempts an incentive for employees, and how is it done?” has obtained invaluable insights both

in the academic field and the practical field of research.

The originality in this research is that the case organization is one of the leaders in the world

when it comes to innovation and that the actual topic has not really been researched before as

explained in the introduction. Through the research it was found that an incentive system as

reward for failure is a positive process to be implemented into an organization due to its

implications on the innovation culture within the company, and does not in any way inhibit the

innovation potential that employees have. Instead of punishing failure, rewarding hard,

audacious attempts, but well thought and planned; gives an overall positive result through the

organization and a signal of open‐mind from the upper management.

8 This challenge is also rather sketchy and needs more research. One interpretation could be that the behavioral latitude is actually the “selfish” reasons suggested by the data collected.

19

Also another positive result is that such a system should offer the employees more space in

departing from day to day routine in order to engage themselves in innovative projects – giving

them the chance to try something new, something different.

The downsides of this system is that sometimes the perception of the employees can be different

from the expected results. As the case study with multiple units’ data shows, employees can use

this sort of incentive system as a mean of boosting their self‐esteem instead of boosting their

morale for innovation. The biggest obstacle found is that management support is a key

mechanism required for this sort of incentive to take place at the beginning and continuous

support throughout its implementation. The other downside is that unless controlled and

carefully planned by management, this sort of system can degenerate into a “playground” where

employees forget about their daily tasks and focus only on award winning projects.

During this research, the conclusions gathered have added invaluable data and information to

the field of innovation management. The implications of an incentive system such as rewarding

failure in innovation attempts are far from be completely researched. Further research on this

topic would be a more extensive research into other types of companies which have similar

processes such as Google or 3M. Due to research limitations, in this research this was not

possible. However, the mere acknowledgment of the existence of such a system, and the data

gathered on its implications should provide enough theoretical database for more research to be

performed.

The main questionability of this research, is that the case study has been based on an extremely

small sample of interviewed. In the future however, more research should be done.

CONCLUSION

In regards to the research question the following should be underlined ‐ Rewarding failure in

innovation attempts is done in other industries as an incentive strategy for employees but only

when done under the right conjuncture of factors. The key mechanisms9 are presented and

highlighted:

An innovation culture or risk taking culture in the organization needs to exist as a precursor for such a system. Such a system cannot be the only motto or main driver for an innovation culture

This incentive system needs careful planning and support from top management and not to forget, constant support.

The company/organization should have a clear agenda on what can be defined as “creative failure” or otherwise said a failure from where employees can learn something and give it another try with better results.

Effort recognition should be in the form of a prize or award, used to revive failed projects

9 A note here is that employee perception has not been accounted for due to the scarce data, which is considered to be important. As suggested, in order to elaborate on this, further research should be made, before stating clearly that it is a mechanism.

20

The potential drawbacks of such an incentive system are summarized as follows:

The system should be carefully applied in the day to day operations, otherwise it can have a counter effect on the employees’ perception and motivation. The behavioral latitude should be followed by a careful and methodical approach.

Unless the top management contributes actively, this sort of incentive system is at danger of being lost

Since the research is part of a Master Thesis, the research adds and draws more clear perspectives on which are key mechanisms in place for conducting such a system, and from this, further research can be made on testing the groundwork for the applicability of such a system in the construction industry.

References

Baumann, O., & Stieglitz, N. (2014). Rewarding value‐creating ideas in organizations: The power

of low‐powered incentives. Strategic Management Journal, 35(3), 358‐375.

Bihl, G. (1995), Werteorientierte Personalarbeit. Strategie und Umsetzung in einem neuen Automobilwerk, BMW AG, Munchen, p. 130.

Bougrain, F., Forman, M., & Haugbølle, K. (2010). Industrialisation in construction: Multiple

actors, multiple collaborative strategies. Paper presented at CIB world Building Congress 2010,

Salford, United Kingdom.


Creswell, J. W. (2007). Qualitative inquiry and research design: Choosing among five traditions. Thousand Oaks, CA: SAGE. Creswell, J. W. (2009). In Creswell J. W. (Ed.), Research design: Qualitative, quantitative, and

mixed methods approaches (3. ed. ed.) Thousand Oaks, Calif.: Sage Publications.

Glaser, B.G., & Strauss, A.L. (1967). The Discovery of Grounded Theory: Strategies for Qualitative

Research. New York: Aldine

Guba, E. G., & Lincoln, Y. S. (2000) Paradigmatic Controversies, Contradictions, and Emerging

Influences. In N. K. D. Y. S. Lincoln (Ed.), Handbook of qualitative research (pp. 163‐188).

Thousand Oaks: CA: Sage

Gupta, A., & Singhal, A. (1993). Managing human resources for innovation and

creativity. Research Technology Management, 36(3), 41.

Irby, B. J. (2008). In Lunenburg F. C. (Ed.), Writing a successful thesis or dissertation: Tips and

strategies for students in the social and behavioral sciences Thousand Oaks, Calif.: Corwin Press.

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Kriegesmann, B., Kley, T., & Schwering, M. G. (2007). Making organizational learning happen:

The value of “creative failures”. Business Strategy Series, 8(4), 270‐276.


Sørensen, H. (2015). Development of an innovation process for managing employee‐driven





Winch, G. (2003). Models of manufacturing and the construction process: The genesis of re‐ engineering construction. Building Research & Information, 31(2), 107‐118.

22

Appendix C

The possibilities of the construction industry of learning by example

This is a working paper, part of the Master thesis “Development of a Conceptual Framework on

rewarding failure in innovation attempts as an incentive for employees within the construction

industry”.

The paper has the aim of investigating and answering the second Research Question of the

report: “How can the construction industry learn from other industries by taking example?”

The research is carried out through a cross‐industrial analysis by working upon a theme emerged

during this study. The main topic of the report investigates a new incentive system of rewarding

failure in innovation attempts. This research is primarily based on the results found in previous

research [See Appendix B – Rewarding failure in innovation attempts. An incentive program] and

it is based on a cross‐industrial analysis with deep insights into existing theory.

INTRODUCTION

The construction industry is not regarded as an innovative industry [Wandahl et.al 2011] but is

rather considered slow‐paced when it comes to innovation compared to other industries

[Bygballe & Ingemansson, 2014]. One of the issues carefully studied and well known is that the

construction industry is rather focused on easy wins, rather than long‐term gains through the

planning of development and innovation. [Sørensen, 2015]. But there is always hope in this

matter. Studies reflect the reality as so the construction industry can learn from other industries

by not being idiosyncratic. [Winch, 2003] Well known to many, and research shows and comes

to reinforce this, is that the complexity of the construction industry is a factor always to take into

consideration, whatever the process might involve. The construction industry is considered by

some “a complex arena” [Seaden & Manseau, 2001], but its main characteristic is that it is usually

driven by single and unique projects [Tatum, 1987]. [Winch, 2003] suggests that the complex

production system model that the construction industry has, is very relevant when it comes to

“re‐engineering the construction process”.

Whether we are talking about construction or other industries, innovation is an important part

of any successful organization that hopes to achieve competitive advantage on the market

[Tangkar & Arditi, 2000]. And what is most important, that it is a requirement that companies in

the construction industry, start innovating more than relying on proven technology [Tatum,

1987].

Researchers, seem to agree that it is not solely up to R&D departments to provide innovation but

that employees are becoming more involved in the process and are considered an incredible

source of innovative ideas [Tangkar & Arditi, 2000; Sørensen, 2015; Kesting & Ulhøi, 2010]

23

The purpose of this paper is to contribute to the overall development of the conceptual

framework within the main thesis by gathering and analyzing important data for the

implementation of an incentive such as rewarding failure in innovation attempts in the

construction industry. The paper does not constitute in itself the conceptual framework, nor does

it gives the overall picture of the thesis research. However, it acknowledges that previous

research on the matter has been done and develops and adds upon the findings presented in

[Appendix B] and creates the theoretical landscape of the possible deployment of such an

incentive program in the real‐world.

METHODOLOGY

In this paper the objective is to challenge the construction industry having to learn from other

industries from a theoretical point of view. In establishing a proper methodological approach,

the term how in the research question gives already a significant implication on which type of

research should be most appropriate.

“A qualitative study is a means, for understanding and exploring the meaning of groups or

individuals in a particular problem." [Creswell, 2007]

Having this in mind, a brief explanation is needed. The problem studied in this paper is the

research question, but that is part of an overall thesis and then the groups or individuals which

have a meaning as Creswell argues is more related to the industry itself and academia in this

scenario.

This paper has several limitations, however. The literature review presents the author’s

interpretation of facts deducted from the literature. Although, usually researchers who use

qualitative inquiry methods are predominantly using more an inductive approach, in this case,

the literature review containing most of the relevant information, the research takes, therefore,

a deductive approach.

Having defined in the Main Report that the overall thesis is a qualitative study, the next step was

to identify the methodological implications of this paper. While taking Creswell’s assumption to

the point of referencing, the objectives of the paper are presented so that the methodological

approach and then methods for conducting the research could be stated.

The present study looked into and aimed at understanding the key mechanisms that are

driving the construction industry to learn or it can be called the learning industry

First it will define key mechanisms required for the industry to learn by adoption from

other industries by using the historical application of lean principles within the

construction industry.

Second it will test the Employee Driven Innovation for a potential fostering environment

of a new incentive system.

24

Third, it syntheses the common mechanisms needed for the construction industry to

learn with the mechanisms required for the adoption of EDI.

The methodology applied to this paper is a qualitative approach10, and the research methods are

explained in the research design.

Description Method Output

Analysis of Lean processes absorption by the construction industry This has been conducted by an extensive literature study, with the final purpose of analyzing in depth the learning process and adoption of Lean processes within the construction industry in order to find emerging mechanisms


Key mechanisms for the learning industry

EDI process to be tested for close themes related to the incentive program to secure a proper implementation environment Once the research found a suitable common‐ground in terms of innovation process, this step was to test EDI for a potential environment of fostering rewarding failure.


Key areas for adoption of a new incentive system

10 The delimitation of this paper is that no empirical data collected can support it. On the other hand, one could argue that it is a working paper, part of a thesis which already contains empirical data, and therefore this paper comes to contribute to the development of the thesis.

25

Development of a theoretical base of knowledge Having studied close themes in a potential fostering management process by using fundamental traits of the construction industry as a basis for implementation, a synthesis closes the research with the development of a theoretical base of knowledge for implementation of an incentive program and presents potential further research areas.

Empirical: Synthesis

Research Question 2

Table 2.1 – Research Design in three steps

Table 2.1 summarizes the framework of the research conducted and gives a good view of how

the study has taken place and how the research took place. For a better comprehension of the

steps however, they are explained further on.

Step 1

This step has been the preliminary analysis of the research. To have a reference point this phase

involved identification of relevant literature through specific databases and using a certain

method in obtaining a better picture of how Lean processes were absorbed by the construction

industry.

The process of finding literature has been inspired from [Levy and Ellis, 2006] and had good

results in the choice of relevant peer‐reviewed articles. This has been done by using the analytical

program NVivo.

Once relevant literature has been found, extensive content analysis has been done in order to

secure the topic as best as possible from a theoretical point of view, with regards to its successful

application in the industry.

Step 2

Having in mind the potential in Employee Driven Innovation (EDI) regarding innovation

management and how closely related the process is to the studied phenomenon, EDI has been

selected as an appropriate methodology where a new incentive system could be fostered. The

clarification on this matter is that the study does not look into a real‐life application of EDI in a

construction organization, but it looks on the possible applicability of an incentive system such

as rewarding failure in innovation attempts into the process’s theoretical framework.

26

Step 3

Once EDI’s theoretical framework has been carefully studied for potential gaps where a new

incentive program could fit, the research had the purpose of synthesizing the findings into a

theoretical base of knowledge, where an incentive program such as rewarding failure in

innovation attempts could find its outsets in the construction industry. The step is an

accumulation of knowledge from steps 1 and 2 which had the purpose of developing the

theoretical base of knowledge of what are the essential traits of the construction industry where

the applicability of an incentive system could fit easier and be implemented with a higher success

rate. This step also contains valuable information about why would such an implementation work

better by using the existing advantages of the construction industry, and also it presents possible

setbacks and why a real case scenario implementation might not work.

LITERATURE SEARCH

The identification of an ideal process already adopted by the construction industry by taking

examples from other industries was made by conducting a test analysis into the existing literature

within databases related straight to the construction industry. This choice is argued by the fact

that the trustworthiness of the data in certain databases is unquestionable due to its implications

for the subject area researched.

By following the steps described in [Levy and Ellis, 2006] one database was selected to be used

for the search of relevant literature: American Society Of Civil Engineers.

Before the research is presented a short clarification on the choice of Lean construction. As

described by [Winch, 2003] little relevance have Lean processes from the automotive industry

outside housing production. However, complex system production models are more relevant to

the topic of the learning industry. This valuable information gave already an entirely

approachable idea in regards to what type of processes should be taken into consideration for

research on learning development within the construction industry. Also in the same reference,

[Winch, 2003] makes reference to lean processes being adopted not correctly at that point in

certain situations.

Once the search process has been selected, relevant articles were searched to comprehend a

wider knowledge on the lean processes adoption. By using search strings formed by a

combination of keywords resulted in a list of 260 articles. An important filter applied to the search

was that the article type had to be research articles, peer‐reviewed, to ensure more credibility to

the information that was going to be extracted. Due to time limitations, 260 articles were

considered too many to be further checked, and further trimming was required. A very rough

selection based on the titles of the articles narrowed the search to 45 relevant articles. The

27

selection of articles to be used for conducting content analysis has been made by an abstract

review, and a total of 5 articles were selected for a full review.

Using backward and forward referencing as described in [Levy and Ellis, 2006] two more

important articles have been found on the topic, one published in Emerald Insight and the other

published by Taylor and Francis.

To ensure more credibility to the research, the analytical program NVivo was used to generate

word frequency queries in all articles. The word frequency query had certain filters applied. The

results should include usage of stemmed words, and the word should have a minimum length of

4 characters. The 10 most frequent words used in these articles were then reduced to a number

of 8 because “design” and “works” were not considered relevant and can be used in a lot of

irrelevant contexts for the purpose of this paper. The other 8 remaining words were then coded

in order to create a Coding Matrix to test yet again the validity and the relevance of the literature

against the required knowledge database.

Figure 1 – Results from coding

Figure 2 – Matrix coding query

The overall purpose of using the analytical program NVivo in this case, was to test analytically the

usefulness of the literature selected for review against a number of parameters. For once, the

keywords used most often in the literature suggest that a high amount of information could be

extracted. Second, the appearance in large numbers of the keywords against the imposed

literature suggests that there is a definite connection between the articles chosen for review.

Thirdly, the Matrix presents an overall picture of what article/s has most connection to which

step of the research. Since the overall purpose of the working paper is to gather enough

28

theoretical data to sustain and argue for the development of a conceptual framework in the main

report, this analyzing method adds credibility and trustworthiness for the literature review.

ADOPTION OF LEAN CONSTRUCTION FROM THE MANUFACTURING INDUSTRY

In their work, [Howell, et.al, 2011] discuss the development of Project management within the

construction industry dating 50 years back in time. [Thaís et. al, 2012] seem to concur on this

while developing on the fact that the change requests that have seem to be ongoing for decades

did not call for anything less, but a change in the very fundamentals of the industry with a special

focus on how the management operates within. A small note is that “Lean construction refers to

the application of lean thinking to the delivery of capital projects in the architecture‐engineering‐

construction (AEC) industry.” [Tommelein, 2015] More than being called a fundamental change

in the industry, researchers agree that it is more than that; it is “a paradigm shift” [Thaís et. al,

2012; Tommelein, 2015]. [Kuhn, 1977, p.294] gives an explanation of how a paradigm can be

interpreted as a “global, embracing all the shared commitments of a scientific group”. Since these

assumptions are shared by researchers in their study conducted so far – to present date; it is

strongly recommended to consider the Lean Construction11 as the first real change done by the

construction industry by obviously applying principles derived from the manufacturing industry.

When a construction project delivers maximum value to the customer and in the same time it

minimizes waste, it is considered “a lean project” [Ballard & Howell, 2003]. [Ballard & Howell,

2003] conclude that construction projects are temporary production systems and this can be

traced back to initial research found, whether they are called complex or not [Ballard & Howell,

2003; Winch, 2003]. While visiting the Detroit Ford Plant, Eiji Toyoda, president of Toyota at that

point, studying the outset of the plant, concluded that his company should be using all resources,

including space, time, tools and human effort to a minimum; but in the same time maximizing

the output [Sullivan, 2011]. The relation to the manufacturing industry for this reason is obvious.

It was not the actual lean process derived from that point in time, but the lean philosophy.

In relation to innovation, literature suggests that deriving from the five models of construction

innovation [Slaughter, 1998], most of innovations happening in the construction industry are

rather incremental and with the human capital occupying a central role. [Ozorhon et. al, 2014,

Sørensen, 2015] [Kesting & Ulhøi, 2010] suggest that “radical innovations are not user‐driven,

they are employee‐driven”. This suggests that in EDI, in a historical perspective, in the industry,

innovations are radical, not incremental.

11 In order to prevent misunderstanding, the term Lean Construction is preferred for usage in regards to the application of Lean to the construction industry. While many processes and models have emerged from the Lean philosophy, an overall meaning needed to be used. For further reference see [Ballard & Howell, 2003]

29

DRAWBACKS ENCOUNTERED IN LEAN CONSTRUCTION IMPLEMENTATION

However, testing the historical facts of how Lean has been applied to the construction industry

on the overall scale, research shows that two main problems were encountered:

The application of lean to an entire industry involved first and foremost the issue that the

construction industry delivers different products with no clear definition of what is value

for the customer, while the manufacturing industry can easily define the quality and value

of a finite product for a customer.

The second issue encountered was the “control”. While construction industry evaluates

results by looking backward to a project already finished and assessing the results, the

manufacturing industry can overcome that issue by preventing and foreseeing any issue

by looking forward, acting directly on the process

[Sullivan, 2011]

In a different set‐up a case study on Timber Frame production showed a more practical and

related to a single case approach in regards to barriers. To sum it up the following are

enumerated:

Inexperience of work force

Resistance to change of employees

Unavailability of products on the market

[Ozorhon et. al, 2014]

In addition to the clear evidence in literature, other type of anecdotal evidence has been noticed

in another research:

Misunderstanding of Lean principles; employees tend to misunderstand the whole point and they mix the meaning for example LPS (Last Planner System) with Lean thinking.

Lack of commitment from the foremen

Confusion of Lean as Building Information Modeling (BIM) combined with Virtual Design

Construction (VDC)

[Thaís et. al, 2012]

FACTORS CONSIDERED MECHANISMS IN LEAN CONSTRUCTION ADOPTION

Research shows that various factors can be considered “enablers of innovation”12 in the

application of Lean within the construction industry. Results from several sources are presented

and discussed consequently:

12 However, in order not to create confusion by different word usage, the term “mechanism/s” has been preferred and used.

30

Project participants were integrated through partnering of the contractor with the user‐client.

Commitment of leadership towards adoption of innovative measures

[Ozorhon et. al, 2014]

Other research shows a more theoretical approach:

Concept mapping to negotiate meanings (merely a tool for better communication)

Organizational learning

Action learning in the form of regular meetings – “problem solving method”

[Hirota et. al, 1999]

One interesting remark is to be done though. While reviewing the literature for the needed

information, an auxiliary information came through as well. As a precursor for learning,

organizations need to “unlearn” outdated practices and discard them to make room for better

ones. [Thaís et. al, 2012]

TESTING EMPLOYEE‐DRIVEN INNOVATION FOR A POTENTIAL FOSTERING

ENVIRONMENT

By now research shows, that one of the main mechanisms in achieving a successful

implementation of any innovative idea it needs continuous support from management and

integration of project participants in the process. The idea of assessing whether Employee‐Driven

Innovation (EDI) could be a fostering environment for an incentive system comes from

experience gathered across research literature. The literature shows evidence of both a

theoretical approach and from a more practical point of view, a framework of conducting EDI in

a large project based organization within the construction industry in Denmark, [Sørensen, 2015]

and experiences from Norwegian work life [Aasen et.al, 2012].

From a theoretical point of view, Employee‐Driven Innovation can have five main drivers in decisions about innovation within an organization [Kesting & Ulhøi, 2010]. Figure 3 illustrates how an ideal type organizational structure which fosters EDI would work.

31

Figure 3 – Ideal type organizational structure of conducting EDI [Kesting & Ulhøi, 2010]

Drawing some perspectives on the framework, there are four main essential conditions that need

to be taken into account for, and needed for EDI to work.

Potential and limits of employee participation

Idea generation

Drivers of employee participation

Management support

Having in mind these 4 essential conditions before going further with any analysis, one of the

main drivers for employee participation in this framework are “incentives”. [Kesting & Ulhøi,

2010] argue that if the employees are not rewarded for their efforts, they have no extrinsic

incentives to come up with ideas and only intrinsic incentives remain.

From a more practical point of view and in a shorter version of Figure 5.1 [Aasen et.al, 2012] present results concluded from an analysis into practical examples from the Norwegian work‐life. Their case study units were ranging from the construction industry to public administration and defense.

32

Figure 4 – Interrelated elements of EDI [Aasen et.al, 2012]

Making a quick comparison on the two figures presented, from two different sources which had

completely different datasets for proposing the elements of EDI in one framework or in an

interrelation we see the same emerging patterns. An example would be that the cultural

characteristics suggested by [Aasen et.al, 2012] can represent the limits of employee

participation, and their authority and/or the management alike. Another example would be that

the cultural characteristics which have an influence from the professional roles and the other

way around [Aasen et.al, 2012]; can have potential connection to the feedback & revision process

between the two different structures in an organization, employees and management [Kesting

& Ulhøi, 2010]

Another reference was an exploratory case study by [Sørensen et.al, 2014] were, through a

research conducted, different perspectives of employees on EDI in a large project based

organization in the Danish construction industry were tested. The case study concluded five key

mechanisms in regards to the applicability of EDI.

Management – [Sørensen et.al, 2014] both through field testing, and literature review concludes that this is the main theme important for a framework. As study points out, management is required to be of constant support, skilful in communication, ready to empower employees and recognition. [Kesting & Ulhøi, 2010; Aasen et.al, 2012] support all this.

Knowledge sharing – indication in the case study was that employees seemed to agreed when approached about it, that knowledge sharing would be a key factor in conducting EDI, however no indication exists of employees doing so actively through gathering of employees for example.

Organizational culture – not only [Sørensen et.al, 2014] found through research that organizational culture is a key mechanism, but also [Kesting & Ulhøi, 2010; Aasen et.al, 2012] support this.

33

Employee motivation and education – as previously, all sources [Sørensen et.al, 2014; Kesting & Ulhøi, 2010; Aasen et.al, 2012] seem to agree that employee motivation is an important contributing key mechanism to conducting EDI. An important factor to be taking into account here, concluded by [Sørensen et.al, 2014] is that not all employees are motivated by incentives, but that some employees could be satisfied with the current situation. This seems to be in some sort of alignment with [Kriegesmann et.al 2007] which argue that 10‐20% of employees venture into new territory. It can be extrapolated to incentives as well. Not all incentives work, and definitely not on all people.

Process – This area has not really been explored neither in literature, neither in practice.

[Sørensen et.al, 2014] draw some perspectives on this, but more research is needed on

how to give more importance to the processes needed in conducting EDI.

In order to conclude this part of the study, the extensive literature review has shown similar

patterns in regards to what is an acceptable framework for conducting EDI; both theoretical and

in practice [Aasen et.al, 2012]. Even though the research is in its inceptive phase on EDI, and more

than that on its application into organizational context, this field of innovation is definitely

something worth considering for companies wishing to take a leap forward in the competitive

market.

The analysis carried out has been of significant importance for this working paper due to two

main reasons:

It would be hard to describe and analyze a different organizational context within the construction industry where an incentive system such as rewarding failure in innovation attempts could have a place. Not only it would be hard to describe, but since extensive literature is needed for such an attempt, the reasoning for the argument is mostly deductive at this point. By deducing from hard literature studies and various applications in real‐life contexts the contextual framework of EDI where new incentive systems could have place, and establishing key mechanisms; is considered to be of considerable importance for the research field.

Second, by establishing a theoretical landscape with already tested, even if scarcely applications of it, the research can continue its search in answering the second research question within the thesis.

DEVELOPMENT OF A THEORETICAL LANDSCAPE FOR THE APPLICABILITY OF AN

INCENTIVE SYSTEM SUCH AS “REWARDING FAILURE IN INNOVATION

ATTEMPTS”

The research takes position now into synthesizing the findings presented in this working paper.

While solving the two established objectives of this working paper, similarities have repeatedly

emerged; whether in the literature concerning the adoption of Lean construction within the

construction industry, whether in the literature concerning the applicability of an EDI system to

an organization within the construction industry.

34

The process of Lean adoption is far from done, the process of adopting a process for conducting

innovation such as EDI is by comparison, decades behind where lean is today. However, this does

not represent an abandon of the topic; but merely an encouragement for the industry to gather

strength with the academic world more in finding ways and collaborating more in order to

implement in practice new, conceptual processes but which can prove to be either radical, either

small, incremental changes.

As recommendations were made by the academic world for a better dissemination of Lean

Construction [Thaís et. al, 2012], so can the process of adopting EDI be disseminated and

eventually new incentive ways such as “rewarding failure”. But it requires gathering and

combining forces of both the industry and the academic world.

To summarize all the findings presented here, and to synthesize them into a small theoretical

landscape, the conclusions will be presented as key mechanisms for how can the construction

industry learn from other industries and under what circumstances by taking into account the

history of the construction industry as “a learning industry” when it came to the application of

Lean construction.

It is considered that both the application of Lean construction in the construction industry and

the efforts of implementing an EDI model are innovation processes. Therefore the key

mechanisms emerged from the content analysis both for innovating and for inhibiting these

innovation processes will be presented.

In providing an answer for the research question that the paper aimed at obtaining an answer

the following conclusion can be drawn.

CONCLUSION

The construction industry, as slow‐paced as it is, and resistant to change, is and will still be a

major player in any society’s economy. Therefore, in order to keep up with the current trends, it

needs to step up in order to catch from behind the other industries in the run for value. By taking

an example from the application of Lean processes in the construction industry, mainly with

theoretical data and practical data coming from the manufacturing industry, the following key

mechanisms have been identified and summarized:

All project participants need to be actively involved in any radical innovation. They need

to have first a theoretical background of what exactly they are trying to implement, and

then according to their roles, they have different needs for being motivated to participate.

Depending on the role of the participant within a project organization or set‐up, different

needs are in effect; employees need constant support from the management, and

feedback. Not only do they need support, but they need to still be managed, while the

management loosens the chain and allows for some spare time on just individual learning.

As explained before, individual learning is organizational learning.

35

There is a great need for better communication tools/skills between the participants in

an innovation process. Misunderstanding of a certain process for example, literature

shows [Thaís et. al, 2012], is quite common and therefore should be avoided.

Employees need extra motivation in the form of incentive systems from top management

in order to make sure that their attention is retained in face of the new challenge.

Potential drawbacks of learning from the manufacturing industry for example is that where the

manufacturing is having an (MTO) Make to Order approach, the construction industry has been

and it will have an (ETO) – Engineer to Order approach, in most case scenarios [Portioli‐

Staudacher 2012; Salem 2006]. Another potential drawback is that the current culture within the

construction industry is still old‐fashioned and going for the low hanging fruit (easy but sure wins)

– This attitude of “a little bit of something is better than a large amount of nothing” keeps

harming the industries innovative potential and serious action needs to be taken.

Last, but not least, one of the most important characteristics of the construction industry needs

to be always taken into account when new innovative processes are to be learned by the

construction industry – its own set‐up. The construction industry as it has a large amount of

participants and is a large complex production system in itself, needs to be aware of its settings

and how it could change them, or at least adapt faster to changes in its complex system.

To summarize everything, it is necessary that further research should be made on the topic of

“How can the construction industry learn from the manufacturing industry by taking example? “

The manufacturing industry it seems, has the closest set‐up or at least even if different, it is easier

to work with, due to the production system that both industries are based on [Portioli‐Staudacher

2012; Salem 2006].

References

Aasen, T. M., Amundsen, O., Gressgård, L. J., & Hansen, K. ’In search of Best Practices for

Employee‐Driven Innovation: Experiences from Norwegian Work Life’ (2012). In Høyrup S.

(Ed.), Employee‐driven Innovation: A new approach; Basingstoke : Palgrave Macmillan.

Arditi, D., & Tangkar, M. (2000). Innovation in the construction industry. Civil Engineering

Dimension, 2(2), 96‐103.

Creswell, J. W. (2007). Qualitative inquiry and research design: Choosing among five traditions.

Thousand Oaks, CA: SAGE.

Ballard, G., & Howell, G. (2003). Lean project management. Building Research &

Information, 31(2), 119‐133.


36

Hirota, E.H., Lantelme, E.M.V. and Formoso, C.T. (1999), “Learning how to learn lean construction concepts and principles”, Proceedings IGLC‐7, Berkeley, CA, pp. 411‐22.

Howell, G. A., Ballard, G., & Tommelein, I. (2011). Construction engineering‐‐reinvigorating the

discipline. Journal of Construction Engineering and Management, 137(10), 740.

Kesting, P., & Ulhøi, J. P. (2010). Employee‐driven innovation: extending the license to foster

innovation. Management Decision, 48(1), 65‐84.






Ozorhon, B., Abbott, C., & Aouad, G. (2014). Integration and leadership as enablers of

innovation in construction. Journal of Management in Engineering, 30(2), 256.

Portioli‐Staudacher, A., & Tantardini, M. (2012). A lean‐based ORR system for non‐repetitive manufacturing. International Journal of Production Research, 50(12), 3257‐3273.

Salem, O., Solomon J., Genaidy, A., & Minkarah, I. (2006). Lean construction: From theory to implementation.(author abstract). Journal of Management in Engineering, 22(4), 168.

Seaden, G., & Manseau, A. (2001). Public policy and construction innovation. Building Research

& Information, 29(3), 182‐196.

Slaughter, E. S. (1998). Models of construction innovation. Journal of Construction Engineering

and Management, 124(3), 226.

Sullivan, K. T. (2011). Quality management programs in the construction industry: Best value

compared with other methodologies. Journal of Management in Engineering, 27(4), 210.

Sørensen et al. (2014) Employee‐driven innovation in large project organisations In: Laryea, S. and Ibem, E. (Eds) Proceedings 8th Construction Industry Development Board (cidb) Postgraduate Conference, 10‐11 February 2014, University of the Witwatersrand, Johannesburg, South Africa, 269‐280 Sørensen, H. (2015). Development of an innovation process for managing employee‐driven





37

Thaís, d. C., Milberg, C., & Walsh, K. D. (2012). Exploring lean construction practice, research,

and education. Engineering, Construction and Architectural Management, 19(5), 512‐525.

Tommelein, I. D. (2015). Journey toward lean construction: Pursuing a paradigm shift in the AEC

industry. Journal of Construction Engineering and Management, 141(6), 04015005.

Wandahl, S., Bejder, E. & Ussing, L.F. (2011a), 'Trust as a Competitive Parameter in the

Construction Industry'. In: Ruddock, L. I. & Chynoweth, P. (eds.) COBRA 2011: Proceedings of

RICS Construction and Property Conference. Salford. Press.

Winch, G. (2003). Models of manufacturing and the construction process: The genesis of re‐ engineering construction. Building Research & Information, 31(2), 107‐118.

1

DEVELOPMENT OF A CONCEPTUAL FRAMEWORK ON

REWARDING FAILURE IN INNOVATION ATTEMPTS AS

AN INCENTIVE FOR EMPLOYEES WITH OUTSETS IN THE

CONSTRUCTION INDUSTRY

ANNEX LIST

Contents ANNEX LIST .................................................................................................................................................. 1

Annex A 1.1 - Catalogue of Projects/Projektkatalog – Inspiration for final The-sis/Inspiration til afgangsprojekter

Annex A 1.2 - Initial Research Design

Annex B 3.1 - Steps for data collection

Annex B 3.2 - Correspondence with TATA Group

Annex B 3.3 - TATA InnoVista - Tata Review, April 2014 pp. 58-62

Catalogue of Projects/Projektkatalog – Inspiration for final The-

sis/Inspiration til afgangsprojekter Autum 2015/Efterår 2015

Rev. A, 17th of June 2015

Side 2 af 27

Catalogue of Projects /Projektkatalog Catalogue of Projects is for inspiration for the final thesis. There are freedom of choice in correlation with

the topic.

Maybe some new topics will show up later.

Projektkataloget er udarbejdet som inspiration til afgangsprojekter. Der er ved afgangsprojekter valgfrihed i

forhold til emner, men ønskes en specifik vejleder, kan der med fordel ønskes at arbejde med et projekt fra

kataloget.

De foreslåede projekter ligger inden for vejledernes forsknings- og hovedkompetenceområder.

Der har været stor tilfredshed blandt de studerende som har valgt at tage udgangspunkt i et projekt fra in-

spirationskataloget, to tidligere afgangsstuderende udtaler:

"Efter vores overbevisning har det været en klar fordel at vælge et emne ud fra projektkataloget, da vi på

denne måde fik en vejleder med stor faglig indsigt i emnet, der samtidig var rigtig entusiastisk og engageret

omkring vores arbejde. Dette har hjulpet os utroligt meget undervejs." (Kristian & Palle, BL4 2014)

Side 3 af 27

Key performance indicators Foreslået af: Søren Munch Lindhard

Projektet følger en standardiseret metode til identificering af nøgle performance indikatorer. Metoden føl-

ger to skridt: først identificeres mulige indikatorkilder og herefter holdes de identificerede indikatorer op

mod hinanden, for at afgøre hvilke indikatorer som er drivere og hvilke som bliver ”drevet”. Ved at identifi-

cere driverne findes de parametre som er afgørende for hvor godt der bliver performet på en byggeplads

Det er nødvendigt at interviewe de forskellige parter i en byggesag (gerne alle fra samme byggeri).

Side 4 af 27

Root cause identification Foreslået af: Søren Munch Lindhard

Projektet tager udgangspunkt i en byggeplads som foretager PPU målinger (værktøj i Last Planner System).

Her arbejder gruppen på at identificere årsager til hvorfor aktiviteterne ikke er færdig til tiden, eksempelvis

vha. 5 gange hvorfor modellen. Ud fra årsagerne kommes med konkrete forslag til hvorledes det kan for-

hindres at problemerne gentager sig selv.

Yderligere kan gruppen se på hvorledes de ikke færdiggjorte aktiviteter påvirker projektets tid, økonomi og

kvalitet.

Side 5 af 27

Rework in on-site construction Foreslået af: Søren Munch Lindhard

Igennem projektet ses på mængden af fejl og mangler i byggeriet og på de medførende årsager og virknin-

ger på byggepladsen. Årsager og virkninger analyseres for at finde ud af hvorledes fejl og mangler opstår

og hvordan de kan reduceres.

Side 6 af 27

Kulturforskelle i en dansk og en udenlandsk entreprenør virksomhed/ Cultural

difference in a Danish and a foreign Contractor Company

Foreslået af: Lene Faber

Antal studerende: min 2.

Danske entreprenørvirksomheder arbejder og styrer et byggeprojekt på en måde og har nogle holdninger

og normer som forventes opfyldt at samarbejdsparterne, men er de forventninger de sammen i en ikke

dansk virksomhed og hvilke udfordringer kan det eventuelt give at blande nationaliteter i et byggeprojekt.

A Danish contractor company works and leads a building project in one way and have some approaches

and norms that they anticipate their collaborators to fulfil, but are those expectations the same in a not

Danish company and which potential challenges can there be when you mix different nationalities in a

building project.

Side 7 af 27

Hvordan er projektteamet på de gode sager sammensat/How is the Project team

composed on the god Projects


Antal studerende: min 2.

Flere gode byggesager udvælges. Det undersøges hvordan projektlederen og ingeniørerne er udvalgt til sa-

gen og hvorfor sagen er gået godt. Er der sammen hæng i måden at udvælge på og eller sammenhæng i

hvorfor en sag går godt?

Side 8 af 27

Hvordan bliver en ny afdeling synlig i et lokalområde?


Videreførelse af et nuværende projekt

Antal studerende: min 2

Side 9 af 27

Fremtidens almene ungdomsboliger


Antal studerende: min 2

Et samarbejde med COWI Vejle. Mulige emner:

• Hvordan klarlægges byggeriets vision og strategi?

• Hvordan kortlægges interessenterne?

• Hvordan sikres rettidig brugerinvolvering (og hvem/hvordan repræsenteres brugerne)?

• Hvordan udnyttes det unikke i grundens placering og dens muligheder ift. det omgivende miljø?

• Fastlæggelse af afstand mellem omgivende miljø og fremtidige beboerpræferencer?

• Hvordan prioriteres boligens fleksibilitet, æstetik, brugervenlighed og arkitektoniske kvalitet og hvilke

virkemidler har vi til rådighed?

• Hvordan indarbejdes forventninger/krav til miljø og energi?

• Etc.

Side 10 af 27

Partnering and contracting

Foreslået af: Erik Bejder & Kristian Ditlev Bohnstedt

Sprog i rapport: Valgfrit – Dansk eller Engelsk

Purpose - Partnering is often, by economists, and construction managerial literature related to more in-

complete contracts. This can be explained by seeing partnering as something that neutralizes opportunism.

The aim is to uncover whether partnering neutralizes opportunism when there is an incomplete contract or

reduces transaction costs for renegotiation of complete contracts when new information arises.

Design - The study is a cross-sectional design comprising document analysis and interviews.

Findings - Firstly that partnering does not necessarily entail more incomplete contracts, which contradicts

the incomplete contracting theory. Secondly, in complete contract setting partnering can be motivated

when seen as a willingness to renegotiate complete contracts i.e. partnering lowers transaction costs for

renegotiation. Partnering can make it rational for one party to accept disadvantageous outcomes with the

conception of being repaid later in accordance to reciprocity.

Value - Seeing partnering as the willingness to renegotiate complete contracts can reduce the risk for the

contractor and lead to lower prices for a given service.

Side 11 af 27

The ‘definition’ of partnering as a set of components



Purpose - Although many articles have discussed the characteristics of partnering, there is no consensus

about the meaning of the concept. Partnering is often characterized, as a complex and complicated concept

where no agreement about a standard type of definition exists. The aim is to provide a new method to de-

fine the vague and multifaceted concept of partnering in a flexible and structured way.

Design - The study consists of a literature review and a questionnaire-survey. A final verification is made us-

ing interviews on selected cases determine underlying elements and factors in the focus areas of the firms.

Findings - There are two necessary components in partnering – trust and mutual understanding. Second, a

number of different components can be added to form a specific variant of partnering.

Value - The definition model can help to concretize and pinpoint which components a partnering organiza-

tion should include in a specific construction project.

Research limitations/implications - Generic models are typically subject to some cultural and geographical

limitations, just as in this case.

Side 12 af 27

The concept of organizational goal – the process in partnering



Taking the contextual embeddedness of partnering as starting point, the aim here is to work towards a

more profound theoretical basis for the partnering phenomenon in construction. To pursue the aim, this

paper adopts an organization theory perspective on partnering incorporating theory about the decision-

making process within organizations constrained by organizational goal acting upon bounded rationality.

By observing how partnering organization pursue their goals, the mechanisms which is essential for success

studied from a ”Concept of Organizational Goal” and ”Decision-making process” perspective.

Theory: Herbert A. Simon: Organizations: Information processing, decision-making process within econom-

ic organizations, problem-solving, attention economics, organization theory, complex systems and adminis-

trative man.Administrative Behavior: Decision-making

Side 13 af 27

Partnering – Evaluation of user satisfaction so fare – New Evaluation Tool (NET)



As in all policy areas, one important feature for research is evaluation (Benchmarking).

1. Evaluate current partnering efforts to identify key success factors and barriers.

2. Conduct an evaluation using a method suggested by Johan Nysström, which is applied as a quasi-

experimental method where partnering projects are matched with non-partnering projects.

3. Approach based on project documentation (BEC – Byggeriets Evalueringscenter) and Survey for publicly

procured projects in order to assess the effects of partnering in the Danish construction industry.

Side 14 af 27

Offentlige udbud efter Udbudsdirektiverne - Hvordan kan små- og mellemstore

virksomheder få del i ordrerne?

Foreslået af: Arne P. Rasmussen

Sprog i rapport: Dansk

Den danske byggebranche bygger sit fundament på små -og mellemstore virksomheder (SMV), som via in-

novation og faglig styrke udvikler sig til store virksomheder over tid.

Der hersker en opfattelse af, at store udbud efter udbudsdirektiverne herunder OPP/OPS-projekter alene

kan opnås af store totalentreprenørselskaber .

Hvordan overvindes disse barrierer af SMV-ere i byggebranchen?

Kan det overhovedet lade sig gøre?

Hvorledes kan man som SMV organisere sig for at komme i betragtning til store offentlige udbud?

Der har i efteråret 2014 kørt en række informationsmøder/kurser rettet mod SMV-ere hos Væksthus Nord-

jylland, hvor der har været stor interesse for at opnå større viden om f.eks. Udbudsdirektiverne m.v.. Se

http://startvaekst.dk/vhnordjylland.dk/offentlige-byggeri

http://startvaekst.dk/vhnordjylland.dk/offentlige-byggeri

Side 15 af 27

Sikkerhedsstillelse i byggebranchen – Giver det økonomiske problemer for virk-

somhederne?

Foreslået af: Arne P. Rasmussen


Den danske byggebranche er reguleret af nogle bestemmelser ”agreed documents” benævnt AB-reglerne.

Disse regler giver oplysning om størrelse og varighed af sikkerhedsstillelserne, som skal anvendes ved afta-

ler mellem offentlige og offentligt støttede byggerier. Samme regler anvendes i stor udstrækning i den pri-

vate sektor.

Det har fremgået af dagspresse og fagpresse at omfanget af sikkerhedsstillelser kan påvirke virksomheder-

ne yderst negativt bl.a. med konkurser til følge.

Det kunne overvejes om reglerne er tidssvarende og/eller der findes andre modeller, som kan give tilsva-

rende sikkerhed for bygherrer, rådgivere og entreprenører.

Det undersøges om konsekvenserne af mange og store sikkerhedsstillelser påvirker virksomhederne øko-

nomisk negativt.

Kan krav om sikkerhedsstillelse påvirke konkurrencesituationen?

Side 16 af 27

Industrialisering af byggeprocessen Foreslået af: Henrik Sørensen

Forsvarsministeriets Ejendomsstyrelse er i gang med at konceptudvikle fremtidens kaserne med et kon-

ceptbyggeri på Aalborg Kaserner i Nørresundby. Baggrunden for projektet er at skabe mere mobilitet i For-

svarets bygningsmasse, således bygninger kan samles og adskilles af mindre moduler, der kan flyttes rundt i

ind- og udland, alt efter hvor behovet er.

Grundtanken er, at bygningerne består af en fast kerne (rygrad), og at der på denne monteres modulele-

menter (kredsløb), der er præfabrikerede og som relativt nemt kan afmonteres igen og flyttes til en anden

fast kerne, uden at der gås på kompromis med kvalitetsniveauet eller bygningens bæredygtighed.

Konceptet rummer mange måder at industrialisere byggeprocessen, samt muligheden for at inddrage leve-

randørleddet i bæredygtig produktudvikling.

Side 17 af 27

Innovation in the Construction Industry Foreslået af: Henrik Sørensen

One of the perspectives that are not really resolved in terms of innovation driven by employees is the di-

lemma, of as to how innovation projects that fail or where setbacks continuously occurs should be reward-

ed, still with the thought in mind that the employees should be motivated to contribute to innovation on

long-term basis. One approach could be a survey-based study between several companies within the con-

struction industry that have both succeed and/or experienced innovation failures.

Side 18 af 27

Sikkerhedsstillelse i byggebranchen II – Giver det problemer for bygherrer, hvis

denne ikke stiller sikkerhed overfor entreprenøren?

Foreslået af: Anne Marie Herforth og Lene Faber


Entreprisekontrakter er i vidt omfang baseret på forhandlede vilkår i de såkaldte ”agreed documents”, her-

under AB92.

Kontraktvilkårene omfatter bl.a. pligt eller ret til sikkerhedsstillelse mellem bygherre og entreprenør. Da

vilkårene er et forhandlingsresultat kan de fraviges af bygherre i udbuddet af et bygge-/anlægsprojekt.

Ofte er der fokus på, hvad det betyder økonomisk for en entreprenør at skulle stille sikkerhed overfor byg-

herren.

I den sammenhæng kunne det argumenteres, at den modsatte vinkel – nemlig bygherrens overses. For

hvilke overvejelser lægges til grund, når en bygherre vælger IKKE at stille sikkerhed overfor en entreprenør?

Får det konsekvenser for bygherren, og i givet fald hvilke? Står besparelsen ved ikke at stille sikkerhed mål

med eventuelle konsekvenser?

Da der ikke kan kræves sikkerhedsstillelse af offentlige bygherrer, jfr. Ab92 § 7, er målgruppen private byg-

herrer med/uden offentlig støtte samt disses rådgivere.

Det undersøges om konsekvenserne af manglende sikkerhedsstillelse overfor entreprenøren påvirker byg-

herrens byggeprojekt negativt.

Side 19 af 27

Variation af enhedspriser – hvad betyder BIM for AB92 § 14, stk. 3?



I den danske byggebranche har mængdeudtag historisk været entreprenørens opgave. Dette gav anledning

til på bygherre side, at prisforskelle i tilbud reelt kunne være baseret på forskelle i de bydendes mængdebe-

regninger, og på entreprenørsiden gav det anledning til, at alle bydende skulel sidde og foretage det sam-

me opmålingsarbejde for at beregne tilbud.

Afholdelse af udbud er til dels reguleret af § 2 i de såkaldte ”agreed documents”, herunder AB92.

Reglen giver en opskrift på, hvad et udbudsmateriale som minimum bør bestå af. Herunder nævnes, at

bygherre kan anmode om, at tilbud gives på dertil udarbejdede tilbudslister, og videre at konkurrence på

bygherres anmodning kan holdes såvel på samlet budssum som på enhedspriser.

Netop enhedspriser reguleres særligt i AB92 § 14, stk 3 og stk. 5.

Det kunne overvejes om reglerne er tidssvarende og/eller om bygherrers rådgivere er sig bevidste om, hvad

BIM modellering betyder for bygherre og/eller entreprenør set i relation til AB92 § 14, stk. 3.

Det undersøges om konsekvenserne af manglende agtpågivenhed ved BIM udbud påvirker bygherrer

og/eller entreprenørvirksomheder negativt.

Side 20 af 27

Kan et forbedret samarbejde på tværs af fag opnås i en klassisk entrepriseform?



Byggeparternes forhold til bygherren er reguleret af nogle ”agreed documents”. For rådgivers vedkom-

mende er det ABR89, og for entreprenørens er det f.eks. AB92.

I ABR89 pkt. 1.1.1. fremgår således at rådgiver skal varetage klientens interesser og af pkt. 1.1.5, at rådgiver

skal medvirke til rimelige aftaler mellem bygherre og entreprenør. I AB92 § 20 fremgår, at entreprenørerne

har pligt til at samarbejde med tilsyn og hinanden.

Den danske byggebranche synes ofte at være præget af alles kamp mod alle. Dårligt samarbejde medfører

fordyrelser og forsinkelser, hvilket ikke er i hverken bygherrens eller samfundets interesse.

Nyere samarbejdsformer, herunder partnering, søges implementeret i dansk byggeri for at imødegå dette.

Det kunne overvejes om reglerne i ABR 89 og AB92 burde være tilstrækkelige til at sikre bygherrens interes-

ser.

Det undersøges om ABR89 og AB92 kan anvendes som værktøj til forbedret samarbejde mellem rådgiver og

entreprenør, og dermed som alternativ til en egentlig partnering konstellation.

Side 21 af 27

Hvordan opfatter udenlandske entreprenører AB92 / ABT93? How does foreign

contractors perceive GC92 /GC93?


Sprog i rapport: Dansk og engelsk

I danske bygge- og anlægsprojekter anvendes ”agreed documents” som standard kontraktvilkår, herunder

AB92 og ABT93.

Disse vilkår regulerer forholdet mellem bygherre og entreprenør før, under og efter udførelsen.

Da Danmark er med i EU skal offentlige eller i et vist omfang offentligt støttede projekter udbydes i EU,

hvilket betyder, at udenlandske entreprenørvirksomheder har mulighed for at byde ind på og vinde et byg-

ge- eller anlægsprojekt i Danmark.

Alle offentlige eller offentlig støttede projekter skal baseres på AB92 hhv. ABT 93.

Det undersøges om de udenlandske vindende entreprenører forstår indholdet af AB92 og / eller ABT 93, og

hvordan vilkårene påvirker de udenlandske entreprenørvirksomheder (økonomisk / selskabs organisatorisk

/ bemandingsmæssigt / juridisk ned ad mod UE).

Side 22 af 27

Virtual Design and Construction (VDC) in the contractor’s organization

Proposed by: Kjeld Svidt

Language: Danish or English

In recent years, the construction industry has started changing from traditional 2D CAD drawings to more

intelligent 3D object based models of the entire building. Such models give us a number of new possibilities

in tendering as well as for planning and controlling the activities at the construction site through advanced

4D models and possible links between the physical construction components and the virtual building mod-

el. New information and communication technology can improve the communication of correct instructions

at the right time for the construction work as well as capturing information for quality assurance and as-

built documentation.

The purpose of this project is to identify important problems within the area and propose solutions for fu-

ture use of state-of-the-art information technology in the contractor’s organization and at the construction

site.

Main activities:

Identify current practices and problems in traditional construction projects Review of enabling technologies, software, hardware, international initiatives Test existing methods, software, hardware Identify needs and requirements for new solutions Build early prototypes with more or less functionality for initial tests The work may be carried out in collaboration with a construction company.

Side 23 af 27

Building Information Management in the Facility management organisa-

tion Proposed by: Kjeld Svidt


Facility Managers are continually faced with the challenge of improving and standardizing the quality of the

information they have at their disposal, both to meet day‐to‐day operational needs as well as to provide

upper management reliable data for organizational management and planning. A number of different fla-

vors of IT systems ‐ CAFM, CAD, IWMS, CMMS ‐ service the wide range of needs in the facilities arena, but

there are still many challenges in managing all information relevant for different purposes in the Facility

Management organization.

The purpose of this project is to identify important problems within the area and propose solutions for fu-

ture use of BIM and other aspects of information technology in the Facility management organization.

Main activities:

Identify current practices and problems in a Facility Management organization

Review of enabling technologies, software, hardware, international initiatives

Test existing methods, software, hardware

Identify needs and requirements for new technological and organizational solutions

The work may be carried out in collaboration with a Facility Management organization.

Side 24 af 27

BIM based design coordination in the construction industry

Proposed by: Kjeld Svidt


The construction industry is changing from traditional CAD drawings to more intelligent 3D object based

models of the entire building. There are many attempts to improve the design process by making a better

connection between object based CAD systems and simulation tools. The simulation tools can be more or

less integrated with specific CAD systems or they may exchange data through open international standards.

An important issue for the structural engineer is also the often complicated coordination with requirements

from other disciplines such as architecture, HVAC etc. New IT tools are introduced to assist this coordina-

tion.

The purpose of this project is to identify critical elements of the integrated design and coordination process

and examine how new methods and information technology can assist us in the future construction indus-

try.

Main activities:

Identify strength and limitations in current practices and identify opportunities with upcoming technologies in the area

Review of enabling Information and Communication technologies (ICT), including software, da-ta models, international standards, and human computer interaction tools

Examine today’s possibilities with existing tools Identify needs for new ways of working and from that derive a list of requirements on technical

solutions Demonstrate possible solutions for the near future and describe issues for future development The work may be in collaboration with a consulting engineering company.

Side 25 af 27

Sustainability assessment and BIM based building design Proposed by: Kjeld Svidt


The construction industry is changing from traditional CAD drawings to more intelligent 3D object based

models of the entire building (BIM). There are many attempts to improve the design process by making a

better connection between object based CAD systems and simulation tools. Sustainability assessment

schemes are normally focusing on evaluating the final building design more than acting as decision support

and design aid in the creating design proposals. They are not integrated in BIM tools.

The purpose of this project is to evaluate if the knowledge behind sustainability assessment schemes like

DGNB, LEED and BREAM in combination with BIM could add more value in the early design phase.

Main activities:

Identify strength and limitations in current practices and identify opportunities with upcoming technologies in the area

Review of enabling Information and Communication technologies (ICT), including software, da-ta models, international standards, and human computer interaction tools

Examine today’s possibilities with existing tools Identify needs for new ways of working and from that derive a list of requirements on technical

solutions Demonstrate possible solutions for the near future and describe issues for future development The work may be in collaboration with a consulting engineering company.

Side 26 af 27

Screening af udførelsesfejl i projekter hos Aarsleff Rail A/S

Foreslået af: Arne P: Rasmussen, AAU og Claus Dam Christensen, Aarsleff Rail A/S

Antal studerende: 3 (dog min. 2)

Sprog: Dansk

Oplæg fra Aarsleff Rail A/S:

Aarsleff Rail A/S gennemfører en lang række projekter i løbet af et år, både små projekter til under 1 mio.

kr. og større projekter over 100 mio. kr. I disse projekter laver vi en del fejl, der kan være mindre fejl som

en forkert rørdimension, men også større fejl som forkert afsætning, der kan have fatale følger.

Virksomheden adskiller sig fra andre entreprenører, idet projekterne ofte foregår på og omkring jernba-

nen, og vores arbejder bliver ofte udført i ”spærringer” af jernbanen (typisk om natten og i weekender).

Når vi så laver en fejl og skal have den rettet, skal vi ofte have nye ”spærringer”, og dermed genere togtra-

fikken igen. Det fordyrer processen væsentligt.

Der er indtil nu ikke lavet en egentlig registrering af fejl og man har derfor ikke noget overblik over, hvad

fejlene koster, og hvor der evt. skal sættes ind for at minimere antallet af fejl. Virksomheden er opmærk-

som på at fejl skal undgås, dog uden at have en plan herfor.

Virksomheden er bevidst om, at der ligger en økonomisk gevinst i at minimere fejl, og for at hente den ge-

vinst, er det nødvendigt at få kortlagt problemområder- og omfang for at klarlægge evt. ændrede procedu-

rer i alle projektfaser.

Oplæg til indhold:

1. Afgrænsning af specialet i forholdt til geografi, udvælgelse af projekter, tidsplan osv.

2. Kortlægning af fejl, gennem interviews og møder med projektleder, maskinfører, håndværkere.

3. Behandling af input fra møder og interviews.

4. evt. opsamlende møder og interviews

5. Behandling af data fra udvalgte projekter og vurdering af fejl i hele Aarsleff Rail A/S

6. Kapitalisering af omkostninger som følge af fejl.

7. Konklusioner og evt. forbedringsmuligheder.

Aarsleff Rail A/S tilbyder at stille kontor og kontorartikler til rådighed, samt afholde transportudgifter i for-

bindelse med besøg på byggepladser.

Side 27 af 27

Using Building Models in the Building Industry

Suggested by: Kaj A. Jørgensen

Number of students: 2


The use of Building models provides great opportunities, not only seen in a technical view but also seen from a productivity perspective. Such a project was demonstrated at BL last year in cooperation with Bravida

Aarhus about cost calculation based on quantity surveying. However, many different kinds of similar usages are also possible. In general, there is a need among many actors to make good use of building models in connection with important engineering disciplines like con-

struction, energy, acoustics, hvac, electricity and landscape. All ideas to harvest the "low hanging fruits" by use of data in object based models can potentially demonstrate benefits in many projects.

Dansk:

Anvendelse af bygningsmodeller giver som bekendt store muligheder, ikke bare teknisk set med også set

med produktivitetsbriller. Det var sidste år udgangspunktet for et specialeprojekt for en studerende tilknyttet Bravida i Aarhus, hvor det drejede sig om omkostningskalkulation på basis af mængdeudtræk.

Men mange forskellige anvendelser af lignende art vil også være muligt. Der savnes bredt at flere aktører

sætter gang i udnyttelsen i relation til flere af de vigtige ingeniørdiscipliner som f.eks. konstruktion, energi,

akustik, vvs, el og landskab. Alle ideer til at "høste frugterne" af at bruge data i objektbaserede modeller vil utvivlsomt kunne påvise gevinster til gavn i mange projekter.

1

ANNEX A 1.2 – INITIAL RESEARCH DESIGN

The objective of this Master of Science project is to look into innovation within the construction industry in Scandinavia with a special focus on EDI – Employee Driven Innovation and to suggest an improvement to an EDI already existing framework.

Due to the fact that the construction industry is accused of not being innovative and conservative (Bygballe & Ingemansson, 2014) systematically, problems occur when looking into the innovation capabilities of the construction industry. This leads to Hypothesis 1:

2.1.1 Hypothesis 1

The construction industry is having significant problems in its Research & Development field due to its unwillingness to change.

By confirming Hypothesis 1, the thesis looks into one of the frameworks that tackles the innovation process within the construction industry – Employee Driven Innovation. The research also focuses on the dilemma of whether innovation setbacks and failures should be rewarded (Sørensen, 2015) this leading to a possible integration of a “rewarding failure system” from other industries. This leads to Hypothesis 2:

2.1.2 Hypothesis 2

An EDI framework customized and/or integrated into a construction company could benefit from an integration of “rewarding failure system” from other industries.

For uncertainty about the clarification of a construction company see sect. 2.4

2.2 Research objectives

As mentioned earlier the report has the purpose of looking into the innovation process within the construction industry in Scandinavia and with a special focus on EDI. In order to asses and give a comprehensive idea of the purpose and specific targets of the report the following objectives are mentioned:

Illustrate the current situation of the construction industry in regards to innovation

To define the motives behind companies choices of not using innovation models

To define mechanisms within EDI which could be approached in order to develop

To find specific reasons for companies to choose an EDI model.

2

To gather enough empirical data on successful implementation of a “reward failure system” in other industries and what similarities exist between industries so that such a system could be embedded into an EDI process innovation model already existing.

To synthesize the findings and emerging with an improvement in an already existing EDI process innovation model within the construction industry.

The above mentioned objectives starting with the two up-mentioned hypothesis result in the following research questions which need answering:

2.3 Research questions

What current percentage of construction companies in Scandinavia are using innovation and/or it’s embedded in their strategy?

What are the main motives of not using innovation in construction companies? What are the factors determinant for innovation to be a part of their company strategy? What are the other industries currently using an EDI approach and integrated a reward

failure system and what are the possible similarities with the construction industry? Can similarities between these industries and the construction industry be sufficient

enough so that a “reward failure system” can be integrated within an EDI framework already existing within the construction industry?

2.4 Delimitations

In any research, delimitations are an important topic to be present in order to confer the research more validity and credit and to keep the researcher/research group on the right track. The present report has several targeted objectives and research questions with the ultimate purpose of trying to improve an existing EDI process innovation model within the construction sector. In order to conduct correctly and as accurately as possible this research, several delimitations present due to especially time limits and scarce resources, had to be outlined:

The selected EDI process innovation model is based on Henrik Sørensen’s PhD research thesis which resulted in the “Development of an innovation process for managing employee-driven innovation” in a governmental client organization within the Danish Construction industry. As explained in the thesis the model can be applied also to private-based companies/corporations. (Sørensen, 2015).

This delimitation is present due to the invaluable insight of Henrik Sørensen’s into this report and topic, which is an incredible advantage due to time and resource limits for this thesis.

The situation of the construction industry in regards to innovation is delimitated strictly to contractors able to take a turn-key project over 50 mil. DKK, delimitation based on the assumption that small and middle sized companies are not the ones driving the industry forward, by thus these two categories considered irrelevant in this research.

3

2.5 Research design model

Table 2.1 represents a graphic illustration of the research design, how it (has been) is planned to be performed throughout the research process with consideration to the two hypothesis, specific targets and the research questions.

Stage

Input Output

1. Current situation of Innovation in Scandinavia

To analyze based on hardcore data and existing papers on the topic the current situation in figures and numbers

Empirical: Literature review Questionnaires Analytical: Content analysis Data analysis

1. Confirm part of H1 2. Answer RQ1

2. Defining the clear motives of not using innovation

By reviewing literature and questionnaires to define the motives behind companies choices of not using innovation models

Empirical: Literature review Questionnaires Analytical: Content analysis Data analysis

1. Reinforce H1 2. Answer RQ2

3. Literature review Review of existing literature on EDI and Innovation processes in order to define mechanisms for EDI possible improvement. And by thus, having prepared an interview set-up.

Empirical: Literature review Analytical: Content analysis

1. Confirm part H2 2. Interview questions?

4. Driving factors for EDI and innovation

By literature review and (a case study) and (interview) to see what are the reasons for companies to choose an EDI model or Innovation embedded within their strategy.

Empirical: Literature review Case study? Interview? Analytical: Content analysis

1. Reinforce H1 2. Answer RQ3

4

5. Literature review on “reward failure system”

Literature review of a “reward failure system” in different industries and emerging patterns that can be similar to the construction industry

Empirical: Literature review Case study Analytical: Content analysis

1. Answer RQ4

6. Development of an advanced EDI process model for the construction industry

Combining a selection of elements from other industries which have successfully implemented a “reward failure system” and a selection of elements/mechanisms used in an EDI framework within the construction industry.

Synthesis 1. Confirm H2 2. Answer RQ5

Table 2.1 – Research design model

References

1) Sørensen, H. (2015). Development of an innovation process for managing employee-driven innovation – in a governmental client organization within the Danish construction industry: Aalborg University Press

ANNEX B 3.1 – Steps for data collection

This is an annex to a working paper, and a part of the Master thesis “Development of a Conceptual

Framework on rewarding failure in innovation attempts as an incentive for employees within the

construction industry”.

The annex has the aim of explaining the steps undertaken for data collection in investigating and

answering the first Research Question:

“Is rewarding failure in innovation attempts done in other industries and how is it done?”

TESTING THE THEORETICAL AND PRACTICAL IMPLICATIONS OF “REWARDING

FAILURE IN INNOVATION ATTEMPTS”

This step was done in order to gain insights both theoretically and practically into the research

topic. [Kriegesmann et.al, 2007] had been an important article in this research due to its

implications to this paper. In the paper, [Kriegesmann et. al] presents factually based on

literature, how zero‐error principles, combined with established incentive systems actually

hinder innovation, due to sanctioning of deviations from norms, established in quality

handbooks etc. The underlying principle which needs further detailing is that there is a large

deviation and difference between the meanings of “failures” in organizations.

““Error tolerance” should be replaced by a differentiated (indeed intolerant!) handling of



taking a calculated risk should, in the event of failure not be punished but, rather encouraged

to further take calculated, sensible risks, in a spirit of optimism. Their experience dates back to

the 90’s when in BMW, the automotive industry, the factory in Regensburg experimented with

an unusual, new incentive system, originally titled “Flop of the Month”.

The case study, is based on a program implemented between 1990 and 1993 at the BMW

factory in Regensburg, Germany. The case study conducted by [Kriegesmann et.al, 2007] has

the required validity and trustworthiness due to two facts:

It has been published in a large database [Emerald Insight] being peer‐reviewed.

It also contains trustworthy data, due to the partly structured interview with Gerhard

Bihl, the Head of Personnel and Social Services at BMW at the time of initiation of this

ambitious program.

The most important information gained through the review of this article was Figure 1

presented below:

Figure 1 – Flops, blunders and creative errors: types of errors, causes and

consequences [Kriegesmann et. al, 2007]

In the figure presented, [Kriegesmann et.al, 2007] argue on what can be considered a “creative

error” and what could be the reasons for failure. In their study, they also present a theoretical

approach to what types of reactions should take place according to the error type. While

sabotage is lying at the top of the list, with zero tolerance and full sanction, “creative errors” lie

at the bottom of the list with full tolerance and zero sanction. As the interviewed states in the

article, the point is that of encouraging employees to take calculated risks in innovation

projects. As long as a project has a 60/40 chance of succeeding, but the risks are taken into

account and the project is thought carefully, then the employee is allowed to carry it through.

This type of innovative attitude gives a very new, modern perspective on innovation. An

innovative attitude that creates “learning potential”. “Instead of rewarding only conventional

“Employee of the Month” which is merely a zero error, highly efficient model‐worker, the

”Creative Error Award” is more along the lines of the tragic hero of everyday business whose

stories harbor unexpected learning potential.” [Bihl, 1995]

The researchers’ conclusions on their article are that:





related to the tasks itself and their implementation are of a sensitive and careful

manner. They recommend “upward career mobility or the prospect of challenging and

rewarding projects in the future”

Another important conclusion not really underlined is the fact that instead of a financial

reward, a personal present was awarded to emphasize the commitment.

The conclusions drawn at the end of this article were enough to proof the theoretical

“playground” of the topic, however this does not necessary mean that it is a theory. It is merely

a phenomenon described, and it required further extensive follow‐up research. By using

forward and backward referencing another useful article came into attention which gave the

idea for two possible companies to be selected for further questioning in hope of data

collection.

The further accumulation of knowledge is based on an article by [Baumann & Stieglitz, 2014].

The article presents similar background data as the previous one, however similar patterns do

emerge. On one hand, in the abstract the statement that ideas from employees are a major

source of value creation reflects perfectly the underlying definition of innovation of

[Schumpeter, 1934] – “innovation is novelty that creates economical value” – [see Chapter 1.3

– Main Report] and also it aligns perfectly with the basic concept of Employee‐driven

innovation where employees are at the center of innovation, and where the connection

between the work organization and the learning organization is obvious [Høyrup, 2012] – [See

Chapter 1.1 – Main report]. The main conclusions at this point were considered not that

relevant, more relevant was the abstract and the reference to two large companies using

incentive systems: Google and 3M. TATA Group on the other hand has been discovered by a

simple Google search, using the search string “reward failure innovation” gave an interesting

online article.1

The article called: “Reward Failures to Crush Employees' Fear of Innovation” by Charles Coy

[Coy, 2014] besides Google and 3M revealed one more company having a system that is the

theme of this research embedded into their innovation strategy: TATA Group.

CASE STUDY AT TATA GROUP

Three companies have been selected through literature review for further analysis. In order to

ensure the trustworthiness of data, a further skimming through the companies was required.

Since the main topic of the report was “Development of a Conceptual Framework on rewarding

failure in innovation attempts as an incentive for employees within the construction industry”

1 As a note on the above statement; as a researcher I do not really approve the method, however in this case it

was most welcome, since TATA Group became the organization which actually provided invaluable answers within

the topic and it has enough data easily accessible online to conduct a case study within this type of project.

the companies selected needed to have a common ground with the construction industry. Out

of the three selected, Google had no relation to the construction industry as opposed to the

other two which were having sub‐companies related straight to the construction industry, or

sub‐companies in the manufacturing industry which is closer related to construction. Google as

such, has been automatically rejected from the analysis based on the up‐mentioned criteria.

3M was also rejected due to rather questionable accessible data which did not provide too

many answers on an online review. TATA Group, on the other hand, provided credible

information both on their website and on a closer look once their innovation program InnoVista

was selected as a basis for further research. In order to develop further the research, a short

presentation of TATA Group is required.

“Founded by Jamsetji Tata in 1868, the Tata group is a global enterprise, headquartered in

India, comprising over 100 independent operating companies. The group operates in more than

100 countries across six continents, with a mission 'To improve the quality of life of the

communities we serve globally, through long‐term stakeholder value creation based on

Leadership with Trust'. Tata Sons is the principal investment holding company and promoter of

Tata companies. Sixty‐six percent of the equity share capital of Tata Sons is held by

philanthropic trusts, which support education, health, livelihood generation and art and culture.

In 2014‐15, the revenue of Tata companies, taken together, was $108.78 billion. These

companies collectively employ over 600,000 people. Each Tata company or enterprise operates

independently under the guidance and supervision of its own board of directors and

shareholders. There are 29 publicly‐listed Tata enterprises with a combined market

capitalization of about $134 billion (as on March 31, 2015). Tata companies with significant

scale include Tata Steel, Tata Motors, Tata Consultancy Services, Tata Power, Tata Chemicals,

Tata Global Beverages, Tata Teleservices, Titan, Tata Communications and Indian Hotels.

With its pioneering and entrepreneurial spirit, the Tata group has spawned several industries of

national importance in India: steel, hydro‐power, hospitality and airlines. The same spirit,

coupled with innovativeness, has been displayed by entities such as TCS, India’s first software

company, and Tata Motors, which made India’s first indigenously developed car, the Tata Indica

and the smart city car, the Tata Nano. Pursuit of excellence has similarly been manifested in

recent innovations like the SilentTrack technology developed by Tata Steel Europe and the next‐

generation Terrain Response, including infrared laser scanning to predict terrain, and Wade Aid

to predict water depth, by Jaguar Land Rover.

Going forward, Tata companies are building multinational businesses that seek to differentiate

themselves through customer‐centricity, innovation, entrepreneurship, trustworthiness and

values‐driven business operations, while balancing the interests of diverse stakeholders

including shareholders, employees and civil society.” [TATA Group, 2016]

It is nearly pointless to further detail on the extend of TATA Group’s insight into innovation

since the above presentation is more than clarifying as related to the credibility and

trustworthiness of data obtained from the company. But, the research’s overall aim being to

study a phenomenon of rewarding failure in innovation attempts and this paper’s aim to study

the research question “How is rewarding failure in innovation attempts done in other

industries?” a connection to TATA Group must be established. While carefully skimming

through the company’s website, the program InnoVista came up. The further presentation is

self‐explanatory:

“InnoVista is not just about making better widgets or products. It is a mental process influencing

the overall innovation culture of the group. The increase in participation from 101 entries from

35 Tata companies in 2006 to over 1,745 entries from 56 Tata companies in 2014 bears

testimony to the growing culture of innovation and risk‐taking within the group.”

[Gopalakrishnan, 2014]

Not mentioned there, but present on TATA Group’s website, is the full range of awards that

TATA InnoVista program has. It ranges from, Promising Innovations with six main categories:

Core Process, New Product, New Service Innovation, Service enabling innovation, Social and

Support; The Leading Edge – Proven technologies, Design Honour and Dare to Try. [TATA

InnoVista 2015] The program is incredibly complex and provides extremely useful information,

but due to research limitations, most of it is excluded from this research, the study is focusing

on one particular category – Dare to Try Award.

According to the same source, [TATA InnoVista, 2015] Dare to Try Award is defined as follows: .

“The award lauds bold attempts at innovation that did not succeed. It celebrates the spirit that

propels individuals and teams to try and innovate and is a reward for the risk‐taking capability

that is necessary for path‐breaking innovation.”

[Gopalakrishnan, 2014] argues:

“When I look back at the journey so far and our many achievements, two stand out. First is the

‘Dare to try’ award category of InnoVista, which recognizes sincere and audacious attempts at

innovation that failed to get the desired result. We keep hearing that it is not Indian culture to

reward failure, but I find the same is being said in all countries around the world. We did some

research on the subject and found an academic paper on BMW’s experiment with failures in

Regensburg, Germany. An HR manager at the company devised a contest which rewarded

people who had failed honestly. The paper categorized various types of failures, ranging from

willful sabotage to inadvertent mistakes to carelessness. It did what I call a ‘diagnosis’ of

failures and prescribed the types of failures that should be encouraged. Inspired by this

example, we created ‘Dare to try’. I think it is quite an unusual and distinctive award. In 2007,

when it was introduced, ‘Dare to try’ received a lukewarm response as companies, especially

those in India, were hesitant to share their failures. But it soon gathered steam with companies

participating from around the world. The growing number of entries in this category (from 12 in

2007 to 174 in 2014) indicates that we have been successful in encouraging people to

experiment and innovate.”

The explanation provided by the director of TATA Sons, Chairman, TGIF (TATA Group Innovation

Forum) – R. Gopalakrishnan is extremely useful for this research since it encompasses all the

main themes extracted from [Kriegesmann et.al, 2007] and TATA Group Innovation Forum’s

internal brainstorming in designing the Dare to Try Award is based on the same literature as it

was presented here: The Case study from BMW factory in Regensburg, Germany. Since the

program is designed on ideas generated from the same source of information as presented in

this paper, and the main ideas and themes generated from the information obtained from

various websites of TATA Group, the match between the initial literature search in testing the

theoretical field of rewarding failure in innovation attempts as an incentive for employees and

the program itself is incontestable. Due to the reasons presented above, TATA Group has been

selected for a more deep analysis, where semi‐open interviews were selected as primary choice

of data collection and obtaining the needed empirical data.

The note that has to be made here, in regards to current step of the research. As explained above, semi‐open interviews over Skype were selected as primary choice of data collection. The interviewing process over Skype was selected due to obvious reasons – a research being conducted in Denmark with no financing, could not possibly have the necessary set‐up to conduct a study trip all the way to India or wherever it was needed. The limitations in this approach was that due to resource and time limitations from the company – this was not possible; the employees asked to provide feedback on the initial proposal either did not answer, either were reluctant in conducting the interviews over Skype, or time limitations required them to focus on their daily operations. However, the method of approach towards TATA Group was the following:

During research into TATA InnoVista and especially Dare to Try Award, the name of several persons with higher authority in TATA Group and their subsidies appeared and were approached in the form of an official e‐mail, however Mr. Ranjeet Joshipura – Deputy General Manager – Innovation with TATA Business Excellence Group (TBExG) answered to the initial briefing.

Mr. Joshipura was kind enough to write to several departments of TATA Group and subsidies closer to Denmark if possible and not only, and to seek for permission of making the necessary connections, so that the research could obtain the necessary data.

Contact was established in the end with two main subsidies of TATA Group – Jaguar Land Rover Limited, UK and TATA Consultancy Services. A more careful presentation of the companies can be found at their official websites2

Once contact has been established with the companies a more detailed explanation was provided on what is the topic and aim of the research, and what type of feedback would be required from them. Since this research had no financing, no compensation for their time was possible, however they have been offered the option of receiving a copy of this research, once completed, and a further collaboration in the same field of research

2 http://www.jaguarlandrover.com/gl/en/ http://www.tcs.com/Pages/default.aspx

would be most welcomed as well and possible in the future coming from one end at least. The aim of the research and the topic presentation is briefly explained below as it was initially sent to the company:

The research purpose was presented: How can rewarding failure be an incentive for employees? – in the form of a Theoretical Framework

A brief interview with some of the Dare to Try Award winners within TATA Group was asked for and the interview’s main points: to see the employee’s perception over the award, what kind of experience it has been for them, whether they have experienced any negativism from as [Kriegesmann et. al, 2007] explain “know‐it alls” or colleagues in a more traditional manner explained.

The question of whether the respective department had any record/survey of how employees feel about innovation compared to before was also asked, and if possible to gain access.

And an interview with the corresponding person or with a supervising manager on the topic of whether such a system would work in any kind of industry was proposed.

Furthermore, the method for conducting the interviews were also explained. The interviews

were suggested to be with several semi‐open questions to ensure large variations of data

collected and to be aligned with qualitative research methods. The questions would not have

been sent before‐hand to prevent any biasing if the interviewed had time to think about the

answer, and the question of whether recording the interviews in the form of Audio format was

also asked, for proper collection and further analysis of data. [For a full view of the

correspondence see Annex A 3.2 – Correspondence with TATA Group]

The answers and e‐mail correspondence with one of the companies (Jaguar Land Rover Limited)

was rather short and with a very scarce but still useful feedback. Once the feedback has been

provided, contact has been lost with the company, and no e‐mail or contact made through.

Contact has been established with Peter Brown, Operations Director at Jaguar Land Rover Ltd,

UK. However the answer to the initial proposal can be summarized below:

“Daring to Try” without fear (or being overly risk averse) is helpful as a precursor to innovation – in other words, taking chances.

The recognition of “failure” in “Dare to Try” is mostly after the event. Therefore it does not contribute in developing an innovation culture directly. In Mr. Brown’s opinion, people apply for the award in order to make from failure “a success” but they rather have succeeded in the first place.

“Dare to Try” should be a motto of an innovation strategy and should be rewarded directly. Then referral is made to the fact that companies prefer easy but sure wins – otherwise commonly known as “low hanging fruit”, thus not taking chances.

The biggest issue is to resource “the daring to try”.

The very short, but still useful information obtained finds similar patterns with the study

conducted at BMW. Once, it establishes clearly that a culture of innovation is necessary, and

that giving people the empowerment of taking chances is a precursor to innovation. However in

respects to the second answer, it can be that the answer is a bit misleading, but it can be

judged in the following way; the initial information was that it does not contribute in

developing an innovation culture directly, however the initial literature states that:

This way of learning is more than individual learning – it is an element of a learning culture for

innovation. Through the symbolic award, creative and courageous but risk‐conscious activities

of innovators are elevated above the risk aversion of the masses of defenders of the status quo.

[Kriegesmann et.al, 2007]

By allowing such an incentive program to take place, not only does the company provide the

necessary climate for innovation to take place, or otherwise being a precursor to innovation but

it allows also the learning process related to EDI to be transferred from individual learning tasks

to an organizational level.

Referring to the third statement, it is a clear indication that failure, if occurring under controlled

and risk calculated environment should be rewarded as a motivation for employees and also as

a mean to foster a culture of innovation within the organization. Concluding on the third

statement, the end of it, that companies prefer easy wins, otherwise said going after “the low

hanging fruit” is something typical for construction companies alike, not only in other

industries.

On the 4th comment, the research shows that resourcing such an incentive can be a problem

since: “Innovation studies suggest that only a ‘‘dynamic core’’ of no more than 10‐20 per cent of

employees will venture into new business and managerial territory.” [Kriegesmann et.al 2007]

Therefore careful planning and certain other incentive methods should be also in place for

giving the extra motivation to employees to develop their innovative skills, and “daring to try”

Going onward to the next contact established with TATA Group – in this case TATA Consultancy Services, the approach was in similar manner conducted. Once formalities have been set up by Mr. Joshipura, a dialogue was opened to test the ground, whether a collaboration could be in place. [For a full view of the correspondence see Annex A 3.2 – Correspondence with TATA Group]. The dialogue took place with Mr. Sujit Guha, from TATA Consultancy Services. A not here is that given that at some point in the correspondence, being clearly told that due to

limitations Skype interviews are very hard to organize, the alternative was politely offered the

option of writing down questions in regards to Dare to Try Award which could be answered

with minimum effort. Despite all the efforts, this was not the first choice in data collection

method, but since empirical data was needed the questions were forwarded; based mostly on

the first answers obtained from Land Rover Limited in order to test the common ground

between subsidies at TATA Group, to whether their employees from different countries and

cultures have the same perception on the subject. This method was chosen as validation

method of the already obtained data, and cross referencing the already emerged themes and

patterns from both literature and empirical data. A summary of the responses can be seen in

Annex A 3.2 – Correspondence with TATA Group

The answers provided from TCS (TATA Consultancy Services) reinforced more the already

emerged pattern and data obtained from both the literature review and the empirical data

from the case organization. The answers are briefly summarized as follows:

Dare to Try rewards failure and thus encourages risk taking. Risk taking is a precursor for a culture of innovation. Most companies want to progress on assured success only. It requires that the mindset of risk taking to be propagated throughout the organization and be supported by the management.

The ideas are judged for recognition based on their effort, and where the teams were unable to overcome risks and roadblocks but the team should also plan going again for it, then is the recognition taking place.

Dare to Try is mostly used to attract management attention and revive failed projects

Dare to Try should not be necessary a motto for an innovation culture but an innovation culture should accept failure as a pillar to success rather than punish it.


References

Baumann, O., & Stieglitz, N. (2014). Rewarding value‐creating ideas in organizations: The power

of low‐powered incentives. Strategic Management Journal, 35(3), 358‐375.

Bihl, G. (1995), Werteorientierte Personalarbeit. Strategie und Umsetzung in einem neuen Automobilwerk, BMW AG, Munchen, p. 130.

Coy, C. (2014, June 27). Reward Failures to Crush Employees' Fear of Innovation. Retrieved

January 3, 2016, from https://www.cornerstoneondemand.com/blog/reward‐failures‐crush‐

employees‐fear‐innovation#.VoqFB_krKUm

Høyrup, S. (2012). In Høyrup S. (Ed.), Employee‐driven Innovation: A new

approach; Basingstoke: Palgrave Macmillan.






Gopalakrishnan, R. In Noronha, C. (2014, April 1). Tata group publication, TATA Review ‐ Going

for Growth (S. Agrawal, Ed.) (pp.58‐62). Retrieved January 4, 2016, from

http://www.tata.com/ebook/tata_review_apr_2014/consolidated_tata_review_apr_2014.pdf

Schumpeter J (1934) The Theory of Economic Development. Harvard, MA: Oxford University

Press.

Tata group profile via @tatacompanies. (n.d.). Retrieved January 3, 2016, from http://www.tata.com/aboutus/sub_index/Leadership‐with‐trust

Tata InnoVista 2015 celebrates 10 years of innovation via @tatacompanies. (n.d.). Retrieved

January 3, 2016, from http://www.tata.com/article/inside/Tata‐InnoVista‐2015‐celebrates‐10‐years‐

of‐innovation

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From: Ranjeet Joshipura <[email protected]>Sent: Tuesday, November 24, 2015 1:14 PMTo: Dragos Bogdan TodoranSubject: RE: InnoVista question

Oh sure – no problem. You can always mention the source of your information as us and the respective Tata company you speak to. With best regards Ranjeet Joshipura DGM – Innovation Group Technology & Innovation Office Tata Sons Limited 7th Floor, Geetanil Building, Nagindas Master Road, Mumbai 400001 Tel: 022-6534 0189 | Mobile: +91 88888 74840 Email: [email protected] | web: http://www.tata.com

From: Dragos Bogdan Todoran [mailto:[email protected]] Sent: 24 November 2015 16:31 To: Ranjeet Joshipura Subject: RE: InnoVista question Hi Ranjeet, If I have attached to the two e‐mails I have sent, I apologize, I did not mean it. If we misunderstood each other, my previous question was if I can attach our conversation for my written Annex related to the Master Thesis. My professors are interested very much in seeing the process of how I managed to get information Besides the results. Thank you very much once again, and hope to hear from you soon positive news Med venlig hilsen / Best regards, Dragos Todoran Stu . Cand . Sc ien t . Tec h – Byg g e le de lse Byg n ing skons t ruk tø r MAK | Cons t ruc t i on ma nage men t Pho ne : ( +45 ) 30 48 93 77 | Ema i l : d to do r14 @studen t .aau .dk dk.linkedin.com/in/dragostodoran/

From: Ranjeet Joshipura [mailto:[email protected]] Sent: Tuesday, November 24, 2015 10:26 AM To: Dragos Bogdan Todoran Subject: RE: InnoVista question Hi Dragos You need not append our conversation to your emails with the companies. I have spoken to them and am connecting you to them only after their concurrence.

2

With best regards Ranjeet Joshipura DGM – Innovation Group Technology & Innovation Office Tata Sons Limited 7th Floor, Geetanil Building, Nagindas Master Road, Mumbai 400001 Tel: 022-6534 0189 | Mobile: +91 88888 74840 Email: [email protected] | web: http://www.tata.com

From: Dragos Bogdan Todoran [mailto:[email protected]] Sent: 23 November 2015 19:46 To: Ranjeet Joshipura Subject: RE: InnoVista question Hi Ranjeet, Thank you very very much for your help once again Please see fit to answer my question about attaching our conversation to my Annex whenever you have time. Thank you once again. I am sure it is evening in India right now, so I wish you a pleasant evening Med venlig hilsen / Best regards, Dragos Todoran Stu . Cand . Sc ien t . Tec h – Byg g e le de lse Byg n ing skons t ruk tø r MAK | Cons t ruc t i on ma nage men t Pho ne : ( +45 ) 30 48 93 77 | Ema i l : d to do r14 @studen t .aau .dk dk.linkedin.com/in/dragostodoran/

From: Ranjeet Joshipura [mailto:[email protected]] Sent: Monday, November 23, 2015 2:39 PM To: Dragos Bogdan Todoran Subject: RE: InnoVista question Hi Dragos Please feel free to contact them directly. I now need not be in the loop anymore. I am trying to get you a couple of more contacts – fingers crossed! With best regards Ranjeet Joshipura DGM – Innovation Group Technology & Innovation Office Tata Sons Limited 7th Floor, Geetanil Building, Nagindas Master Road, Mumbai 400001 Tel: 022-6534 0189 | Mobile: +91 88888 74840 Email: [email protected] | web: http://www.tata.com

From: Dragos Bogdan Todoran [mailto:[email protected]] Sent: 23 November 2015 17:45 To: Ranjeet Joshipura Subject: RE: InnoVista question Dear Ranjeet,

3

Thank you so much for your effort, time and help I will not forget this, and you will definitely receive a copy of my thesis once it is completed. I just have one question, should I wait an answer from the two persons, or should I just write to them with my intentions? I have not received anything from them yet, Peter from JLR answered already and I have started a conversation with him This is why I am asking a bit because I am unsure. Thank you again for your time and you will hear from me as soon as I complete my research One other question would be if it is ok with you to attach the conversation to my Appendix? Due to disclosure policies you have in the company Med venlig hilsen / Best regards, Dragos Todoran Stu . Cand . Sc ien t . Tec h – Byg g e le de lse Byg n ing skons t ruk tø r MAK | Cons t ruc t i on ma nage men t Pho ne : ( +45 ) 30 48 93 77 | Ema i l : d to do r14 @studen t .aau .dk dk.linkedin.com/in/dragostodoran/

From: Ranjeet Joshipura [mailto:[email protected]] Sent: Monday, November 23, 2015 12:17 PM To: Dragos Bogdan Todoran Cc: Rupa Misra; Sujit Guha Subject: RE: InnoVista question Dear Dragos I am hereby connecting you with the following persons (also included in the cc of this email). They shall discuss with you and help you appropriately. Tata Consultancy Services (TCS)

1. Ms Rupa Misra 2. Mr Sujit Guha

With best regards Ranjeet Joshipura DGM – Innovation Group Technology & Innovation Office Tata Sons Limited 7th Floor, Geetanil Building, Nagindas Master Road, Mumbai 400001 Tel: 022-6534 0189 | Mobile: +91 88888 74840 Email: [email protected] | web: http://www.tata.com

From: Dragos Bogdan Todoran [mailto:[email protected]] Sent: 23 November 2015 11:09 To: Ranjeet Joshipura Subject: InnoVista question Importance: High Dear Mr. Joshipura,

4

My name is Dragos Todoran, I am a MSc student in Construction Management at Aalborg University in Denmark, currently writing my Master Thesis, within the field of innovation management. My topic is resumed basically in creating a theoretical framework based on previous examples from other industries how “rewarding failure in innovation attempts can be an incentive for employees”. I came across your name while skimming through the InnoVista Program that TATA Group has, and since I am gathering all possible data on the topic I was wondering if it is possible to get in contact with some of your employees that have won the “Dare to Try Award” for a small chat. I could not find a list of winners unfortunately since I have no access to the portal and I was wondering if it is possible for you to help me out with it Your time would not be forgotten and of course if you are interested you can receive a copy of my thesis once it is done. I really hope you can help me out claryfing this for me. Thank you in advance and wish you a nice day Med venlig hilsen / Best regards, Dragos Todoran Stu . Cand . Sc ien t . Tec h – Byg g e le de lse Byg n ing skons t ruk tø r MAK | Cons t ruc t i on ma nage men t Pho ne : ( +45 ) 30 48 93 77 | Ema i l : d to do r14 @studen t .aau .dk dk.linkedin.com/in/dragostodoran/

1


From: Peter Brown <[email protected]>Sent: Monday, November 23, 2015 1:30 PMTo: Dragos Bogdan TodoranSubject: Re: FW: InnoVista question

Dragos Hope to speak later in the week, today I'm working from home and tied up with other priorities. However, I'm interested and believe that 'Daring to Try' without fear (or being overly risk averse) of failure is helpful as a precursor to Innovation, in other words, taking chances. However, The recognition of 'failure' in 'Dare to Try' awards is mostly after the event. Therefore in itself does not contribute in developing an innovation culture directly. I would say most people apply for 'Dare to Try' awards, are doing so to make a success out of a failure, but would have rather have had success in first place. I would say 'Dare to Try' should be a motto of an Innovation strategy and should be rewarded directly - to many businesses only look at results, hence a culture of doing what is an easy wins. hence follow, rather than lead... I would say the biggest issue is resourcing the 'daring to try' Kind Regards Peter S Brown MSc BEng (hons) CEng MCQI-CQP MIET Research 'Operations and Safety' Lead International Digital Lab, Warwick University, CV4 7AL - MAP Tel: 02476 572936 | Mob 07990 756 282 | email:[email protected] Jaguar Land Rover Limited Registered Office: Abbey Road, Whitley, Coventry CV3 4LF Registered in England No: 1672070 The information contained in this e-mail and any accompanying documents may contain information that is confidential or otherwise protected from disclosure. If you are not the intended recipient of this message, or if this message has been addressed to you in error, please immediately alert the sender by reply e-mail and then delete this message, including any attachments. Any dissemination, distribution or other use of the contents of this message by anyone other than the intended recipient is strictly prohibited. On 23 November 2015 at 12:06, Dragos Bogdan Todoran <[email protected]> wrote:

Dear Peter,

As explained in the e‐mail I have sent to Ranjeet, I am a Construction Management MSc student in the process of the dissertation.

2

A brief description of what I am intending to achieve would be a Theoretical Framework on how “rewarding failure can be an incentive for employees”. The Theoretical Framework would help in further research and grasp the theory existing with any practical experiences. Since I have found little to nearly none practical examples of how such a system would help any organization I wrote to Ranjeet hoping to achieve the following:

‐ A brief interview perhaps with some of the winners of DTT award in TATA Group – I am mostly interested in how they perceived the experience, if it was a pleasant experience for them to be rewarded for innovation attempts which ultimately fail due to x or y reasons but which helped on an overall basis their department for future development.

‐ The interview would also cover their opinion on how exactly the innovation process went (from a social point of view – whether they experienced any kind of bad feelings from their colleagues and how do they feel their colleagues see them after such a failure and a reward). It would be also interesting to know if your department has perhaps a record or a survey of how your employees feel now about innovation compared to before.

‐ Also a small interview or chat with you or a supervising manager for the team that won the award would help me in assessing whether the managers helped the employees in their pursuit for innovation, how exactly where the employees encouraged and most importantly if you (or a manager) believes that there is need for a certain culture of innovation in a company before such an award system for example is to be active or as I have found in a case study for a BMW factory “a good wine bottle from the manager’s wine collection” would be enough reward for the employees to keep on trying despite failure.

‐ And lastly it would be interesting to hear from a supervisor or manager or Head of Department whether such a system could work in any kind of industry ( I know for a fact, BMW tried something like this around 20 years ago, did not find any evidence if it still active now, Google and 3M are also using something similar but I am not really interesting in talking with them since the manufacturing industry is closer related to the construction industry from various points of view.

Both types of interview would not take more than 30 minutes and they would be with open questions (semi‐structured). I would like to get a few answers on especially what I wrote before and I would prefer not to send the questions before the interview since I would like a non‐biased answer since that can happen if the interviewees have time to think about an answer. Also if possible the interviews to be recorded for a harder evidence and so I can transcribe the answers later on for my Appendix.

This is just a step in my Thesis. I have received another e‐mail from Ranjeet in which he connected me with two other persons from TATA Group (I have not received any email yet from them, but I intend to write otherwise). I would like to gather as much practical experiences of employees who were rewarded, and how they feel about it. The second step would be to connect the industries from where I received responses to the Construction Industry and further research would be perhaps to test the applicability of such a system within the Construction Industry.

I am not extremely sure how my thesis could benefit you in any way possible or my findings, but the least I can do for you is that you are credited for your time and effort in it, and receive a copy of it once it is completed. I intend to pursue a Ph.D. degree after completion of my studies in the same field of innovation management so perhaps a future collaboration might also be in effect, and then you might receive better output. If proven as assumed, the findings would benefit your innovation team in the sense that such a reward system is indeed an incentive for employees and should be used further on. I hope this although long answer but brief presents you a bit my intentions.

3

Thank you very much for your quick answer by the way

Med venlig hilsen / Best regards,

Dragos Todoran

Stu . Cand . Sc ien t . Tec h – Byg g e le de lse

Byg n ing skons t ruk tø r MAK | Cons t ruc t i on ma nage men t

Pho ne : ( +45 ) 30 48 93 77 | Ema i l : d to do r14 @studen t .aau .dk

dk.linkedin.com/in/dragostodoran/

From: Peter Brown [mailto:[email protected]] Sent: Monday, November 23, 2015 11:45 AM To: Dragos Bogdan Todoran Subject: Fwd: FW: InnoVista question

Dragos

I work for JLR and I have been given your details (see context in email trail). Before I pass on your details to out Dare to Try winner for 2014. Please provide me with a brief discritpion of what you intent to achieve. And what you could share with the JLR innovation team that might be useful?

Kind Regards Peter S Brown MSc BEng (hons) CEng MCQI-CQP MIET Research 'Operations and Safety' Lead

International Digital Lab, Warwick University, CV4 7AL - MAP

Tel: 02476 572936 | Mob 07990 756 282 | email:[email protected]

4

Jaguar Land Rover Limited

Registered Office: Abbey Road, Whitley, Coventry CV3 4LF

Registered in England No: 1672070

The information contained in this e-mail and any accompanying documents may contain information that is confidential or otherwise protected from disclosure. If you are not the intended recipient of this message, or if this message has been addressed to you in error, please immediately alert the sender by reply e-mail and then delete this message, including any attachments. Any dissemination, distribution or other use of the contents of this message by anyone other than the intended recipient is strictly prohibited.

---------- Forwarded message ---------- From: Peter Brown <[email protected]> Date: 23 November 2015 at 10:41 Subject: Re: FW: InnoVista question To: Ranjeet Joshipura <[email protected]> Cc: Rajesh Bhatt <[email protected]>

Ranjeet

Yes, Thanks, However, it would be interesting if Dragos is taking a global view. I will open up some dialogue with him







The information contained in this e-mail and any accompanying documents may contain information that is confidential or otherwise protected from disclosure. If you are not the intended recipient of this message, or if this message has been addressed to you in error, please immediately alert the sender by reply e-mail and

5

then delete this message, including any attachments. Any dissemination, distribution or other use of the contents of this message by anyone other than the intended recipient is strictly prohibited.

On 23 November 2015 at 09:50, Ranjeet Joshipura <[email protected]> wrote:

Hi Peter

You had a winner in 2014 under DTT (Dual Core Engines).

I am also exploring connections with Tata Steel Europe, TCS and others separately. Since Dragon (student) is in Denmark I thought it easier for a connection within Europe.

With best regards

Ranjeet Joshipura

DGM – Innovation

Group Technology & Innovation Office

Tata Sons Limited

7th Floor, Geetanil Building, Nagindas Master Road, Mumbai 400001

Tel: 022-6534 0189 | Mobile: +91 88888 74840

Email: [email protected] | web: http://www.tata.com

From: Peter Brown [mailto:[email protected]] Sent: 23 November 2015 15:14 To: Ranjeet Joshipura Cc: Rajesh Bhatt Subject: Re: FW: InnoVista question

Ranjeet

The request is contacts for 'date to try' winners - of the top of my head I cant remember who won this category last year ( Was it a JLR Win?). I imagine the winners across Tata regions would help his research.

6

However, I may be able to Help a little for JLR 'dare to try' applications? However, would this years results be more beneficial?







The information contained in this e-mail and any accompanying documents may contain information that is confidential or otherwise protected from disclosure. If you are not the intended recipient of this message, or if this message has been addressed to you in error, please immediately alert the sender by reply e-mail and then delete this message, including any attachments. Any dissemination, distribution or other use of the contents of this message by anyone other than the intended recipient is strictly prohibited.

On 23 November 2015 at 06:51, Ranjeet Joshipura <[email protected]> wrote:

Hi Peter

The trailing mails are self-explanatory. Could you please help?

With best regards

Ranjeet Joshipura

DGM – Innovation

7


Tata Sons Limited


Tel: 022-6534 0189 | Mobile: +91 88888 74840


From: Rajesh Bhatt [mailto:[email protected]] Sent: 23 November 2015 12:03 To: Ranjeet Joshipura Subject: Re: InnoVista question

Ranjeet ... Can you ask Peter to do this as I am travelling to Mumbai tomorrow.

Also give him the names of team leads and their projects who won at regional / global in DTT previously.

What time on 27th should I come to the office?

Thanks and Regards

Rajesh Bhatt

Mobile: +44 7787 299138

Sent from my iPad

On 23 Nov 2015, at 05:49, Ranjeet Joshipura <[email protected]> wrote:

Hi Rajesh

Please refer to the trailing email below. Would you like to help this student with his thesis by connecting him to some teams that have participation / won the DTT awards of Tata Innovista?

If yes, please do let me know so that I can connect Dragos to you.

With best regards

8

Ranjeet Joshipura

DGM – Innovation


Tata Sons Limited


Tel: 022-6534 0189 | Mobile: +91 88888 74840


From: Dragos Bogdan Todoran [mailto:[email protected]] Sent: 23 November 2015 11:09 To: Ranjeet Joshipura Subject: InnoVista question Importance: High

Dear Mr. Joshipura,

My name is Dragos Todoran, I am a MSc student in Construction Management at Aalborg University in Denmark, currently writing my Master Thesis, within the field of innovation management.

My topic is resumed basically in creating a theoretical framework based on previous examples from other industries how “rewarding failure in innovation attempts can be an incentive for employees”. I came across your name while skimming through the InnoVista Program that TATA Group has, and since I am gathering all possible data on the topic I was wondering if it is possible to get in contact with some of your employees that have won the “Dare to Try Award” for a small chat. I could not find a list of winners unfortunately since I have no access to the portal and I was wondering if it is possible for you to help me out with it Your time would not be forgotten and of course if you are interested you can receive a copy of my thesis once it is done.

I really hope you can help me out claryfing this for me. Thank you in advance and wish you a nice day


Dragos Todoran

9

Stu . Cand . Sc ien t . Tec h – Byg g e le de lse

Byg n ing skons t ruk tø r MAK | Cons t ruc t i on ma nage men t

Pho ne : ( +45 ) 30 48 93 77 | Ema i l : d to do r14 @studen t .aau .dk

dk.linkedin.com/in/dragostodoran/

1


From: Sujit Guha <[email protected]>Sent: Tuesday, December 22, 2015 6:06 AMTo: Dragos Bogdan TodoranSubject: Re: FW: InnoVista question

Thanks Dragos. I was under the impression that I should wait for your specific questions as per our last mail interaction. I am sorry if I have missed out on your mails. You are right that now most people are on festive mood and away on vacation. They will get back to work only next year. I will try and get some answers for these questions, if possible I, with my association in Innovation for many years and my total working experience of 28+ years, have given you answers from my perspective (marked in red italics against your questions). Most of my colleagues in TCS would think similarly. If you are looking for different opinion, you may try out different companies where such awards are not institutionalized. Regards Sujit Guha Tata Consultancy Services Ph:- +91 33 66368332 Buzz:- 4338332 Cell:- +91 92310 71365 Mailto: [email protected] Website: http://www.tcs.com ____________________________________________ Experience certainty. IT Services Business Solutions Consulting ____________________________________________ From: Dragos Bogdan Todoran <[email protected]> To: Sujit Guha <[email protected]> Date: 12/21/2015 08:53 PM Subject: FW: InnoVista question

Dear Sujit, I am afraid the questions might have wondered astray and you have not received my initial e‐mail … that`s why I have not heard from you in a while. That gives me a kind of a problem. I realize that holidays are coming fast and people are not going to answer. I will write again the questions for you but I am going to have a discussion later today with my supervisor and tomorrow with my Study Board if I could ask for an extension time for my Master Thesis. I really would like to have a proper interview as initially I wanted since that provides me credible data for my Thesis. Even if it will be later this spring I would just like to know if it is possible to organize such a thing. I do not have absolutely any relevant examples on the problem I am studying and honestly my only hope is your help from TATA Group. Please take a look and tell me what you think. I can ask for extensions, but I would like a certainty that I am asking it with a good cause. Otherwise I have to hand in my thesis on the 8`th of January and that will be without credible data. The questions initially formulated were: ‐ Do you believe that an initiative as “Dare to Try Award” is a precursor for a culture of innovation in a company or should it

2

have a place once a certain innovation culture is established? ‐ Dare to Try rewards failure and thus encourages risk taking. Risk taking is a precursor for culture of innovation in a company. Most companies want to progress on assured success only. However, an innovative idea cannot assure success unless it is tried out. In trying it out it requires that mindset and acceptance from management that ideas may fail. When this mindset is propagated in the organization, people will openly think and come out with innovative ideas and try it out with management support. ‐ When does the recognition of Dare to Try happen? ‐ Only those ideas are recognized which have failed when the team was unable to overcome risks and roadblocks. The uniqueness of the idea, amount and sincerity of the effort put in, the lessons learnt and the teams plans for raring to go again with potential benefits is judged for recognition. ‐ Do employees tend to use the “Dare to Try Award” as some sort of prize to reduce the effects of failure or to embrace innovation possibilities further on and be motivated? ‐ It is mostly used to get management attention and support to revive a failed project ‐ Should Dare to Try be a motto of an innovation culture? ‐ As explained earlier there is no magic formulae to ensure success of every innovation idea. So an Innovation Culture has to accept failure as pillar to success rather than being penalized. ‐ What is the biggest issue of “Dare to Try Award?” or setback? ‐ Setback. Unless such awards are given out, innovators tend to hide failures and it would cause deterioration of innovation culture. I hope you can help me with an answer to these concerns of mine. I wish to receive very good input from some of your colleagues; only then my thesis would have a very good academic approach and I can hope for a good grade (I want to take a Ph.D. later on and without a high grade in my Thesis it is very hard to get one). I hope you can understand my concerns and help me in some way out Thank you very much for your time and patience and I am very very sorry that the first email with questions did not get through. Thanks again Regards, Dragos From: Dragos Bogdan Todoran Sent: Tuesday, December 08, 2015 12:36 PM To: 'Sujit Guha' Subject: RE: InnoVista question Dear Sujit You will receive some questions from me by the end of tomorrow I hope they are going to be good and provide me faster answers Med venlig hilsen / Best regards, Dragos Todoran Stu. Cand. Scient. Tech – Byggeledelse Bygningskonstruktør MAK | Construction management Phone: (+45) 3048 9377 | Email: [email protected] dk.linkedin.com/in/dragostodoran/ From: Sujit Guha [mailto:[email protected]] Sent: Thursday, December 03, 2015 9:26 AM To: Dragos Bogdan Todoran Subject: RE: InnoVista question Dear Dragos It might be difficult to arrange for time for your interview, considering that relevant people are scattered all over the

3

globe and frequently travelling. I suggest that you send a list of questions, for which I can try to get some answers. You may make your questions very specific to encourage response with minimum effort. Regards Sujit Guha Tata Consultancy Services Ph:- +91 33 66368332 Buzz:- 4338332 Cell:- +91 92310 71365 Mailto: [email protected] Website: http://www.tcs.com ____________________________________________ Experience certainty. IT Services Business Solutions Consulting ____________________________________________ From: Dragos Bogdan Todoran <[email protected]> To: Sujit Guha <[email protected]> Date: 12/02/2015 04:48 PM Subject: RE: InnoVista question

Dear Sujit, Sorry for my late answer but I am a bit away for the time being until the end of the week. This is good news :) I also hope for answers since I need to complete the thesis in due time :) I will try the eBook version and see if I can get a hand on that :) Thanks again for your invaluable help :) Best, Dragos Sent from my Windows Phone

From: Sujit Guha Sent: 11/30/2015 11:35 To: Dragos Bogdan Todoran Subject: RE: InnoVista question Dear Dragos I have written to a few of the winning team of Dare to Try to answer your query. They had been on vacation last week. I hope to get some response over the next 2 weeks I think there is a ebook version of the book. You may try the ebook version Regards Sujit Guha Tata Consultancy Services Ph:- +91 33 66368332 Buzz:- 4338332 Cell:- +91 92310 71365 Mailto: [email protected]

4

Website: http://www.tcs.com ____________________________________________ Experience certainty. IT Services Business Solutions Consulting ____________________________________________ From: Dragos Bogdan Todoran <[email protected]> To: Sujit Guha <[email protected]> Date: 11/30/2015 03:41 PM Subject: RE: InnoVista question

Dear Sujit, I have tried to get a hand on “Making Innovations Happen” by Ravi Arora as recommended by you. But unfortunately under any circumstance the book can reach me. I cannot order from Amazon – they do not ship to Denmark, and I have contacted my University Library to acquire the book. They were willing to do so, but they got stuck in the same issue of nobody delivering over to Europe. Do you have any idea how on Earth I can get this book? And I hope you managed to find some sort of help for my initial request Thank you in advance. Med venlig hilsen / Best regards, Dragos Todoran Stu. Cand. Scient. Tech – Byggeledelse Bygningskonstruktør MAK | Construction management Phone: (+45) 3048 9377 | Email: [email protected] dk.linkedin.com/in/dragostodoran/ From: Sujit Guha [mailto:[email protected]] Sent: Tuesday, November 24, 2015 7:17 AM To: Dragos Bogdan Todoran Subject: RE: InnoVista question Dear Dragos Thanks for connecting. TCS is a software services company operating globally with 320,000+ employees. I read through your mail and since you are looking for inputs from manufacturing or construction industry, I thought to recheck with you regarding the relevance of inputs from TCS for your thesis. (In your mail you mentioned about non relevance of Google) Kindly let me know what you are looking for from TCS and I will try to arrange for appropriate inputs from the teams. You may also refer to a book "Making Innovations Happen" by Ravi Arora, published by Penguin. Ravi is managing the Innovista program within TATA group and you will find good details on the program in the book. Regards Sujit Guha Tata Consultancy Services Mailto: [email protected] Website: http://www.tcs.com ____________________________________________ Experience certainty. IT Services Business Solutions Consulting

5

____________________________________________ From: Dragos Bogdan Todoran <[email protected]> To: Sujit Guha <[email protected]> Date: 11/23/2015 07:41 PM Subject: RE: InnoVista question

Dear Sujit, As you have probably heard from Ranjeet, I am a MSc student in Construction Management in Denmark and I am writing my final thesis in the field of Innovation Management. I have already been contacted by Peter Brown from JLR who has asked clarifications about what exactly I might need and how JLR can benefit from my research. I will allow myself to copy paste the e‐mail I have sent to him in order for you to obtain clarifying information about what exactly is my research and how I hope to do it. A brief description of what I am intending to achieve would be a Theoretical Framework on how “rewarding failure can be an incentive for employees”. The Theoretical Framework would help in further research and grasp the theory existing with any practical experiences. Since I have found little to nearly none practical examples of how such a system would help any organization I wrote to Ranjeet hoping to achieve the following: ‐ A brief interview perhaps with some of the winners of DTT award in TATA Group – I am mostly interested in how they perceived the experience, if it was a pleasant experience for them to be rewarded for innovation attempts which ultimately fail due to x or y reasons but which helped on an overall basis their department for future development. ‐ The interview would also cover their opinion on how exactly the innovation process went (from a social point of view – whether they experienced any kind of bad feelings from their colleagues and how do they feel their colleagues see them after such a failure and a reward). It would be also interesting to know if your department has perhaps a record or a survey of how your employees feel now about innovation compared to before. ‐ Also a small interview or chat with you or a supervising manager for the team that won the award would help me in assessing whether the managers helped the employees in their pursuit for innovation, how exactly where the employees encouraged and most importantly if you (or a manager) believes that there is need for a certain culture of innovation in a company before such an award system for example is to be active or as I have found in a case study for a BMW factory “a good wine bottle from the manager’s wine collection” would be enough reward for the employees to keep on trying despite failure. ‐ And lastly it would be interesting to hear from a supervisor or manager or Head of Department whether such a system could work in any kind of industry ( I know for a fact, BMW tried something like this around 20 years ago, did not find any evidence if it still active now, Google and 3M are also using something similar but I am not really interesting in talking with them since the manufacturing industry is closer related to the construction industry from various points of view. Both types of interview would not take more than 30 minutes and they would be with open questions (semi‐structured). I would like to get a few answers on especially what I wrote before and I would prefer not to send the questions before the interview since I would like a non‐biased answer since that can happen if the interviewees have time to think about an answer. Also if possible the interviews to be recorded for a harder evidence and so I can transcribe the answers later on for my Appendix. This is just a step in my Thesis. I would like to gather as much practical experiences of employees who were rewarded, and how they feel about it. The second step would be to connect the industries from where I received responses to the Construction Industry and further research would be perhaps to test the applicability of such a system within the Construction Industry. I am not extremely sure how my thesis could benefit you in any way possible or my findings, but the least I can do for you is that you are credited for your time and effort in it, and receive a copy of it once it is completed. I intend to pursue a Ph.D. degree after completion of my studies in the same field of innovation management so perhaps a future collaboration might also be in effect, and then you might receive better output. If proven as assumed, the findings would benefit your innovation team in the sense that such a reward system is indeed an incentive for employees and should be used further on. I hope this although long answer but brief presents you a bit my intentions. I hope this clarifies a bit Hope in hearing from you soon.

6


Dragos Todoran Stu. Cand. Scient. Tech – Byggeledelse Bygningskonstruktør MAK | Construction management

Phone: (+45) 3048 9377 | Email: [email protected] dk.linkedin.com/in/dragostodoran/

From: Ranjeet Joshipura [mailto:[email protected]] Sent: Monday, November 23, 2015 12:17 PM To: Dragos Bogdan Todoran Cc: Rupa Misra; Sujit Guha Subject: RE: InnoVista question

Dear Dragos

I am hereby connecting you with the following persons (also included in the cc of this email). They shall discuss with you and help you appropriately.

Tata Consultancy Services (TCS) 1. Ms Rupa Misra2. Mr Sujit Guha

With best regards

Ranjeet Joshipura DGM – Innovation Group Technology & Innovation Office

Tata Sons Limited 7th Floor, Geetanil Building, Nagindas Master Road, Mumbai 400001Tel: 022-6534 0189 | Mobile: +91 88888 74840 Email: [email protected] | web: http://www.tata.com

From: Dragos Bogdan Todoran [mailto:[email protected]] Sent: 23 November 2015 11:09 To: Ranjeet Joshipura Subject: InnoVista question Importance: High

Dear Mr. Joshipura,

My name is Dragos Todoran, I am a MSc student in Construction Management at Aalborg University in Denmark, currently writing my Master Thesis, within the field of innovation management. My topic is resumed basically in creating a theoretical framework based on previous examples from other industries how “rewarding failure in innovation attempts can be an incentive for employees”. I came across your name while skimming through the InnoVista Program that TATA Group has, and since I am gathering all possible data on the topic I was wondering if it is possible to get in contact with some of your employees that have won the “Dare to Try Award” for a small chat. I could not find a list of winners unfortunately since I have no access to the portal and I was wondering if it is possible for you to help me out with it Your time would not be forgotten and of course if you are interested you can receive a copy of my thesis once it is done.

I really hope you can help me out claryfing this for me. Thank you in advance and wish you a nice day


Dragos Todoran Stu. Cand. Scient. Tech – Byggeledelse Bygningskonstruktør MAK | Construction management

Phone: (+45) 3048 9377 | Email: [email protected] dk.linkedin.com/in/dragostodoran/

7

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SPECIAL REPORT

Tata Review April 201458

The innovation sanskarR Gopalakrishnan, director,

Tata Sons, and chairman,

Tata Group Innovation Forum,

journey of the Tata group

We didn’t call it ‘innovation’ in those

days, but innovativeness has always

been a part of the Tata group’s

sanskar (traditions), its way of

thinking. In recent years, we have adopted the

global practices associated with encouraging

innovation in the group, and these have added

more power to the spirit of innovation that has

been such an integral part of the Tata way of

doing business.

It is important to understand that there

are several myths about innovation. Disruptive

innovations are not always planned for, they just

happen. Alexander Flemming never set out to find

penicillin, he stumbled upon it while researching

something else; chemically synthesised fertiliser

may not seem like an innovative product

today but at the time it was first formulated for

commercial use, it was a revolution, an innovation

that made it possible to feed the world.

The Tata group’s unique ownership structure,

its pioneering endeavours in steelmaking, in the

generation of hydroelectric power, and other such

businesses, were all innovative ideas that were

very unique for the period in which they were

first thought of. This history of innovation found

a contemporary focus in the Tata group about

a decade back, when it was decided to adopt

innovation as a formal initiative.

The inspiration came from Ratan Tata, the

then chairman of the Tata group, who spoke

of the need for innovation at the Business

Excellence Convention 2004: “To be leaders,

we need to innovate. We need to bring out the

creative strengths of our people and create an

environment … where we do things differently

and do things others have not done.”

This became the springboard for a host

of innovative practices in the group, with Tata

companies encouraging employees to feel free

to experiment and dare to take risks. The Tata

Group Innovation Forum was set up in 2007, to

handhold Tata companies on their innovation

journey and to encourage, inspire and help create

a culture of innovation within the group. This was

a huge challenge because just like it is easier to

teach physics and arithmetic than to teach music

or painting, it is much easier to work on processes

and structures than on culture.

The Tata group is largely a left-brain

organisation, full of engineers, MBAs, lawyers,

“When I look back, I am glad

that we started on our formal

innovation journey the right way

and chose the culture route.”

R Gopalakrishnan, director, Tata Sons; chairman, TGIF

SPECIAL REPORT

April 2014 Tata Review 59

and accountants who are used to a structured

approach to work. We didn’t want to get

academic or esoteric about innovation. We

wanted tactical tools.

One of the first steps we took was to

introduce Tata InnoVista, the annual celebration

of innovation within the group, in 2006. The

idea was to encourage and recognise outstanding

innovations, capture as many of them as possible,

and celebrate the successes and the struggles of

the group’s innovation endeavours. Every year,

Tata companies from around the world showcase

their innovations at this event and winners are

awarded under three different categories. Our

jury list is like a who’s who of India Inc. They ask

searching questions from the participants before

deciding on the awards.

InnoVista is not just about making better

widgets or products. It is a mental process

influencing the overall innovation culture of

the group. The increase in participation from

101 entries from 35 Tata companies in 2006 to

over 1,745 entries from 56 Tata companies in

2014 bears testimony to the growing culture of

innovation and risk-taking within the group.

When I look back at the journey so far and

our many achievements, two stand out. First is

the ‘Dare to try’ award category of InnoVista,

which recognises sincere and audacious attempts

at innovation that failed to get the desired result.

We keep hearing that it is not Indian

culture to reward failure, but I find the same is

being said in all countries around the world.

We did some research on the subject and found

an academic paper on BMW’s experiment

with failures in Regensburg, Germany. An HR

manager at the company devised a contest

which rewarded people who had failed honestly.

The paper categorised various types of failures,

ranging from willful sabotage to inadvertent

mistakes to carelessness. It did what I call a

‘diagnosis’ of failures and prescribed the types of

failures that should be encouraged. Inspired by

this example, we created ‘Dare to try’. I think it is

quite an unusual and distinctive award.

In 2007, when it was introduced, ‘Dare to

try’ received a lukewarm response as companies,

especially those in India, were hesitant to share

Number of entries: InnoVista

their failures. But it soon gathered steam with

companies participating from around the world.

The growing number of entries in this category

(from 12 in 2007 to 174 in 2014) indicates that

we have been successful in encouraging people

to experiment and innovate.

The second achievement that stands out

in my mind is the Tata InnoMeterTM, a unique

tool designed in association with Prof Julian

Birkinshaw of the London Business School.

It works like a thermometer to measure the

innovativeness and innovation culture of a team,

business unit, department or a company. The

findings of InnoMeter are holistic. It appeals

to the basic positive competitiveness amongst

people and enables companies to improve their

innovation climate and ecosystem.

When I look back, I am glad that we

started on our formal innovation journey the

right way and chose the culture route. I always

knew it, but it is now confirmed in my mind

that changing culture is not a two- or four-year

programme. It takes a generation or more to

accomplish and our journey still goes on.

As told to Shubha Madhukar

1,1841,461

1,745

191

2006 2008 2010 2012 2014

101

Number of entries: Dare to try

12 17

85 87

174

2007 2008 2010 2012 2014

Growing numbers: An indication of the growing culture of innovation and risk-taking within the Tata group

SPECIAL REPORT


‘Innovation needs mavericks and Everest climbers’Ravi Arora, vice president, Tata Quality Management Services,

has been closely involved with the group’s innovation journey

over the past seven years. In this article, he talks about the

various aspects of innovation as practised in group companies

“Innovation is like yoga; it may not

be necessary for survival, but is

useful for long-time sustainability.”Ravi Arora, vice president, Tata Quality Management

Services

Tata Quality Management Services

(TQMS) has been driving innovation

in association with the Tata Group

Innovation Forum (TGIF). We have a

team of four members who help to implement

the forum’s decisions. Group-wide initiatives and

programmes have been instituted by the team to

serve as triggers to spark innovation.

One of the most popular programmes

initiated across the group is Tata InnoVista,

through which we try to inspire and motivate

young middle-level managers to take up

innovation projects. An amazing platform, it

enables the capturing of new and innovative

developments in the group — everything that

people are proud of and want to tell others

about. The information is compiled on the

Tata InnoVista website and is accessible to any

Tata employee desirous of knowing about new

developments happening across the group.

Tata InnoVista begins in November and we

get about 2,000 projects from Tata group

companies across the world. In January, the

online process of selection, which has been

developed by CMC and involves more than 300

senior Tata executives, begins.

By February-March, 200 cases are selected

that are presented across seven places spanning

the US, the UK, Southeast Asia and India. The

winners then come to Mumbai for the final round

and the award ceremony. This year, the Tata

InnoVista award ceremony was held on April 23.

An important step last year was to

encourage rewards and recognition at the

company level, and not only at the group level.

This year, for instance, companies like Jaguar

Land Rover (JLR), CMC and Tata Consultancy

Services conducted internal InnoVista-like

programmes. Both JLR and CMC even call

their programmes ‘Internal InnoVista’. They got

SPECIAL REPORT

April 2014 Tata Review 61

hundreds of applications and about 10 to 20

percent were selected and sent for Tata InnoVista.

If more Tata companies initiate InnoVista-

type processes internally and send the best

ones to the group-level InnoVista, it will inspire

more employees and enable the capture of a

larger number of innovations. Many companies,

including Tata AutoComp Systems and Tata Steel

Europe, are considering the initiation of similar

programmes next year.

Tata InnoVerse, an innovation hub, has been

built on the premise that senior Tata executives

should regularly identify, define and articulate

problems and challenges faced by their company

and engage Tata managers to find innovative

solutions. Tata InnoVerse serves as a platform on

which the problems can potentially be presented

to 540,000 Tata managers.

We also have a sub-programme called

Challenges Worth Solving, which is a high-

decibel use of the InnoVerse platform. About a

dozen companies participate in this programme

and we take up one problem per firm, provided

by its CEO/MD. The problem is communicated

through various forums including TataWorld

and tata.com to ensure that the right people —

the experienced and the mavericks — provide

solutions. We have a Linkedin community

of people who have attempted to crack these

challenges. Tata InnoMeter is a measurement

system to assess the state of innovation in

a company — how good is the culture of

innovation and its processes, and how important

and strategic is innovation to the entity.

We also have smaller initiatives such

as the InnoMission, where teams (about

15-20) of senior executives from companies

visit different countries to learn about new

technologies taking root there. We have already

had InnoMissions to the US, the UK, Japan and

Israel. The last one was to Israel about three

years ago. We also invite eminent speakers —

the best minds — from institutions such as the

Harvard Business School, the London Business

School, the University of California, Los

Angeles, Insead and McKinsey to spend two to

three days with senior managers and share their

knowledge and experience.

INNOVATION YOGAInnovation is like yoga; it may not appear to be

necessary for survival, but is useful for long-

time sustainability. Many companies — like

individuals — do learn it, but aren’t able to spend

time practising it.

To make this happen, we constantly try

and engage senior management in innovation

programmes. About five years ago, we used to

spend more time talking about ‘why innovation?’

Everybody now knows why it is important.

Even companies in the commodity space are

participating and winning accolades in InnoVista.

Innovation now gets a fair amount of

timeshare and mindshare of the senior leadership

in Tata group companies. In a few companies, it is

discussed in boardrooms.

All group-wide innovation initiatives,

other than InnoVista, require an engaging top

management to ensure rigorous implementation.

They are like coaches who have to be more

disciplined than the teams. Companies that

have demonstrated rigour in giving importance

to innovating, implementing initiatives and

identifying the right resources are reaping

excellent benefits.

INNOVATION ENABLERSCompanies such as JLR and Titan Company

provide good examples of implementing best

practices in innovation. The latter, for instance,

has something called ‘innovation bazaar,’ an ideas

market place, where employees showcase select

innovations, which triggers new innovations and

collaborations.

Titan also has a programme called

Interweave, an innovation enabler, which

triggers collaborative ideas across four business

units. The company also runs an Innovation

School of Management, where 20 to 25 people

from different units spend a few hours each

week, learning about innovation and finding

solutions to an innovation challenge. Experts and

consultants take classes on ideation, innovation

techniques and tools, mindset changes and

execution. The participants are also taken to

companies within and outside Bengaluru,

which helps trigger new thinking. It is a unique

SPECIAL REPORT


programme that has been in place for more than

three years.

JLR also has an interesting programme in

which employees are encouraged to come out

with innovative ideas on Tata InnoVerse. Teams

with selected ideas are then given two days to

come out with prototypes. A recent example was

the effective use of boot space for leisure purpose

while the vehicle is parked.

OBSTACLES ON THE PATHTO INNOVATIONThere is no company in the world that has

perfected the art of innovation. Innovation needs

a long-term view. Most companies know how to

work on small improvements and incremental

innovations, but they need to learn the art of

working on long-term, radical innovation, which

may not necessarily impact the quarterly results,

but lead to an accrual of benefits over a longer

term. To make this happen, firms need to find

a way to commit resources to innovate. Most

importantly, they need a brave and objective

method to kill a project.

There are companies which feel that the

market is down, morale is down and it is not the

right time to work on innovation. Then, there

are companies who spend time and resources,

and manage to find funds for innovation even

during bad times. Obviously, the latter spring

up faster during the first showers or signs of

recovery, whereas the former would need many

more showers to sprout. Programmes like Tata

InnoVista and Tata InnoVerse PLUS have been

designed to help companies maintain the rhythm

of keeping a consistent focus and commitment

towards innovation.

There are small nuggets of knowledge

available within the group which promote

innovation at team level. Titan, for instance,

has a programme in which every functional

head is allocated about `100,000 to fund small

experiments leading to innovations. Once the

funds are exhausted, they are replenished after

they make a presentation to the senior leadership

on how the funds were utilised.

It is important to assign the right resources:

creative maverick people to think

of new ideas; and Everest climbers who would be

willing to take on the journey of completing the

innovation, which is fraught with risks. The Dare

to Try award in InnoVista attempts to spread this

message to climbers and coaches alike. Looking

ahead, I see senior executives across Tata group

companies becoming more confident about

managing the nebulous subject of innovation,

yielding not only incremental innovations but

also radical ones. This is important because the

Tata portfolio in future and the markets it serves

will demand a higher propensity to innovate.

As told to Nithin Rao

People

Projects

Categories

Jurors

Companies

1,700+ 300+ 708

Tata InnoVista: The evolution2006

2008

2010

2012

20145,000+

Quiet start

Growth

Expanded scope

Consolidation

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